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Social Security is a self-financed program that provides monthly cash benefits to retired or disabled workers and their family members, and to the family members of deceased workers. The program is authorized under Title II of the Social Security Act and administered by the Social Security Administration (SSA). (SSA also administers the Supplemental Security Income (SSI) program authorized under Title XVI of the Social Security Act. See Section 3 of the Green Book for a discussion of SSI, a means-tested program for the aged, blind, or disabled.) As of July 2014, there were almost 59 million Social Security beneficiaries. Of those, almost 42 million were retired workers and family members, almost 11 million were disability beneficiaries, and about 6 million were survivors of deceased workers.[1]
Social Security is financed primarily by payroll taxes paid by covered workers and their employers. In 2014, an estimated 165 million workers are covered by Social Security.[2] Employees and employers each pay 6.2% of covered earnings up to an annual limit ($117,000 in 2014); self-employed individuals pay 12.4% of net self-employment income up to an annual limit ($117,000 in 2014).[3] Self-employed persons may deduct one-half of their Social Security payroll taxes for federal income tax purposes.[4] Social Security is also credited with tax revenues from the federal income taxes paid by some beneficiaries on a portion of their benefits, reimbursements from the general fund of the U.S. Treasury that are made for a variety of purposes, and interest earned on Social Security trust fund assets. Social Security income and outgo are accounted for in two separate trust funds authorized under Title II of the Social Security Act: the Federal Old-Age and Survivors Insurance (OASI) Trust Fund and the Federal Disability Insurance (DI) Trust Fund.[5] As the Managing Trustee of the Social Security trust funds, the Secretary of the Treasury is required by law to invest Social Security revenues in interest-bearing federal government securities (special issues) held by the trust funds.[6] The revenues exchanged for the federal government securities are deposited into the general fund of the U.S. Treasury and are indistinguishable from revenues in the general fund that come from other sources. Funds needed to pay Social Security benefits and administrative expenses come from the redemption or sale of federal government securities held by the trust funds.[7]
In 2013, the Social Security trust funds had total income of $855 billion, total expenditures of $823 billion and accumulated holdings of $2.8 trillion.[8] Because the assets held by the trust funds are federal government securities, the trust fund balance ($2.8 trillion at the end of 2013) represents the amount of money owed to the Social Security trust funds by the general fund of the U.S. Treasury.
Origins and Brief History of Social Security
Title II of the original Social Security Act of 1935[9] established a national plan designed to provide economic security for the nation’s workers. The system of Old-Age Insurance it created provided benefits to individuals who were aged 65 or older and who had “earned” retirement benefits through work in jobs covered by the system. Benefits were to be financed by a payroll tax paid by employees and employers on wages up to a base amount ($3,000 per year at the time). Monthly benefits were to be based on cumulative wages in covered jobs. The law related the amount of the benefit to the amount of a worker’s wages covered by the program, but the formula was weighted to give a greater return, on payroll taxes paid, to low-wage earners. Before the Old-Age Insurance program was in full operation, the Social Security Amendments of 1939[10] shifted the emphasis of Social Security from protection of the individual worker to protection of the family by extending monthly cash benefits to the dependents and survivors of workers. The program now provided Old-Age and Survivors Insurance (OASI).
During the decades that followed, changes to the Social Security program were mainly ones of expansion. Coverage of workers became nearly universal (the largest groups remaining outside the system today are state and local government employees who have not chosen to join the system and federal employees who were hired before 1984). In 1956, Congress established the Disability Insurance (DI) program.[11] Over the years, there were increases in the payroll tax rate, which increased from 2.0% of pay (1.0% each for employees and employers) in the 1937-1949 period to its current level of 12.4%.[12] In addition, there were increases in the amount of wages subject to the payroll tax (the taxable wage base), which increased from $3,000 in the 1937-1950 period to its current level of $117,000.[13] The types of individuals eligible for benefits were expanded over the years,[14] and benefit levels were increased periodically. In 1972, legislation provided that when inflation occurred, benefits would increase automatically each year by the same percentage as the cost-of-living (effective in 1975).[15]
Beginning in the late 1970s, legislative action regarding Social Security became more concentrated on solving persistent financing problems. Legislation enacted in 1977 raised taxes and curtailed future benefit growth in an effort to shore up the system’s finances.[16] Still, in 1982, the OASI trust fund needed to borrow assets from the DI trust fund and the Medicare Hospital Insurance trust fund (borrowed amounts were fully repaid by 1986). In 1983, Congress passed additional major legislation that was projected to restore solvency to the Social Security system on average over the 75-year projection period. Current projections by the Social Security Board of Trustees show that the Social Security system has a long-range funding shortfall. These projections, and other factors, have focused attention on potential Social Security program changes in the future.
Social Security Benefits
Social Security provides monthly cash benefits to retired or disabled workers and to the family members of retired, disabled or deceased workers. To be eligible for a Social Security retired-worker benefit, a person generally needs a minimum of 40 earnings credits (i.e., 10 years of Social Security-covered employment), among other requirements.[17] A worker’s initial monthly benefit payable at the full retirement age (known as the primary insurance amount or PIA) is based on his or her career-average earnings (using the highest 35 years of earnings) and a progressive benefit formula designed to provide a higher replacement rate for lower-wage workers compared to higher-wage workers.[18] A person may claim Social Security retired-worker benefits as early as age 62; however, benefits claimed before the full retirement age (FRA) are reduced permanently to take into account the longer expected period of benefit receipt. The FRA ranges from 65 to 67, depending on the person’s year of birth. If a person claims benefits after he or she attains the full retirement age (up to age 70), benefits are increased to take into account the shorter expected period of benefit receipt. In addition to benefit adjustments based on early or delayed retirement, other adjustments may apply such as those based on simultaneous entitlement to more than one type of Social Security benefit.
For Social Security disability benefits, “disability” is defined as the inability to engage in substantial gainful activity by reason of a medically determinable physical or mental impairment expected to result in death or last at least 12 months. Generally, the worker must be unable to do any kind of work that exists in the national economy, taking into account age, education and work experience. As noted above, a worker generally needs a minimum of 40 quarters of coverage for a Social Security retired-worker benefit. A worker may qualify for Social Security disabled-worker benefits with fewer quarters of coverage, depending on the age at which the worker became disabled. However, a minimum of six quarters of coverage are needed. Similarly, while the worker’s 35 highest years of earnings are used to compute a retired-worker benefit, fewer years of earnings may be used to compute a disabled-worker benefit. A disabled worker’s benefit is not reduced for entitlement before the full retirement age.
Benefits for the Worker’s Family Members
Social Security is sometimes viewed narrowly as a program that provides benefits only to retired or disabled workers. However, about 19% of current Social Security beneficiaries are dependents and survivors of retired, disabled or deceased workers.[19]
Social Security benefits are payable to the spouse, divorced spouse, or child of a retired or disabled worker. Benefits are also payable to the widow(er), divorced widow(er), child or parent of a deceased worker. In addition, in the case of a deceased worker, benefits are payable to the mother or father of a deceased worker’s child when the child is under age 16 or disabled and entitled to a Social Security child’s benefit based on the worker’s record. Benefits payable to family members are equal to a specified percentage of the worker’s PIA, subject to a maximum family benefit amount. For example, the spouse of a retired worker may receive up to 50% of the retired worker’s PIA, and the widow(er) of a deceased worker may receive up to 100% of the deceased worker’s PIA. Benefits paid to family members may be subject to adjustments based on the person’s age at entitlement, the person’s receipt of a Social Security benefit based on his or her own work record, and other factors.
This chapter of the Green Book includes a series of Congressional Research Service (CRS) Reports organized under the following general headings:
· History of Social Security;
· Overview of Social Security;
· Social Security Financing and the Trust Funds;
· Social Security Benefits and Eligibility;
· Social Security Disability Insurance; and
· Program Administration and Administrative Funding.
Readers should consult the reports listed under each of these headings for information and data related to these topics. Separate sections provide a list of Tables and Figures included in these CRS reports, as well as Additional Tables and Figures related to Social Security, followed by a Legislative History and Links to Additional Resources.
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
[1] Social Security Administration (SSA), Monthly Statistical Snapshot, July 2014, Table 2. The latest edition of the Monthly Statistical Snapshot is available at http://www.socialsecurity.gov/policy/docs/quickfacts/stat_snapshot/.
[2] Currently, 93% of workers in paid employment or self employment are covered by Social Security. SSA, 2014 Social Security/SSI/Medicare Information, January 14, 2014, http://www.socialsecurity.gov/legislation/2014factsheet.pdf.
[3] The annual limit on covered wages and net self-employment income subject to the Social Security payroll tax (the taxable wage base) is adjusted annually based on average wage growth, if a Social Security cost-of-living adjustment (COLA) is payable.
[4] Self-employed individuals are required to pay Social Security payroll taxes if they have annual net earnings of $400 or more. Only 92.35% of net self-employment income (up to the annual limit) is taxable.
[5] The OASI and DI trust funds are referred to on a combined basis as the Social Security trust funds.
[6] Social Security Act, Title II, §201(d) [42 U.S.C. §401(d)].
[7] SSA, Trust Fund FAQs, http://www.socialsecurity.gov/OACT/ProgData/fundFAQ.html.
[8] In 2013, 85% of Social Security’s total income was from payroll taxes, 12% was from interest earned on trust fund assets, 2% was from federal income taxes paid on benefits, and the remainder was from general fund reimbursements to the trust funds for a variety of purposes. Of total expenditures, 99% was for benefit payments; the remainder was for administrative expenses and transfers to the Railroad Retirement program. See Social Security Administration, Office of the Chief Actuary, at http://www.socialsecurity.gov/OACT/STATS/table4a3.html.
[9] Public Law 271, 74th Congress.
[10] Public Law 379, 76th Congress.
[11] The DI program was established by the Social Security Amendments of 1956 (Public Law 880, 84th Congress). The program became known as the Old-Age, Survivors, and Disability Insurance (OASDI) program, the formal name for Social Security.
[12] Congress has increased the Social Security payroll tax rate many times over the program’s history. The payroll tax rate under current law (12.4%) was established by the Social Security Amendments of 1983 (Public Law 98-21). Public Law 98-21 increased the payroll tax rate gradually from 11.4% in 1984 to 12.4% in 1990.
[13] The most recent legislative change to the Social Security taxable wage base was in 1977. The Social Security Amendments of 1977 (Public Law 95-216) established ad-hoc increases in the taxable wage base for 1979, 1980 and 1981, followed by a return to automatic wage indexation for 1982 and subsequent years.
[14] For example, the Social Security Amendments of 1965 (Public Law 89-97) established benefits for divorced wives aged 62 or older.
[15] The Social Security Amendments of 1972 (Public Law 92-603) established automatic annual cost-of-living adjustments (COLAs) for benefits already in payment. Social Security COLAs are based on inflation as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) using a formula specified by law.
[16] See the Social Security Amendments of 1977 (Public Law 95-216).
[17] A worker may earn a maximum of four earnings credits (or quarters of coverage, QCs) per calendar year. In 2014, a worker obtains one QC for each $1,200 of covered earnings, up to a maximum of four QCs for earnings of $4,800 or more. A person may receive retired-worker benefits and continue to have earnings from work. If the person is below the full retirement age, however, the current earnings may cause all or part of the person’s benefit to be withheld under the Retirement Earnings Test.
[18] Replacement rates can be measured in different ways; stated generally, replacement rates show a worker’s initial benefit as a percentage of his or her pre-retirement earnings.
[19] SSA, Monthly Statistical Snapshot, July 2014, Table 2. The latest edition of the Monthly Statistical Snapshot is available at http://www.socialsecurity.gov/policy/docs/quickfacts/stat_snapshot/.
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. Certain CRS reports with cover dates earlier than 2014 are included here because their contents remain current.
RL30920: Social Security: Major Decisions in the House and Senate Since 1935
R42035: Social Security Primer
RL33028: Social Security: The Trust Fund
RS20607: Social Security: Trust Fund Investment Practices
R43318: Social Security Disability Insurance (DI) Trust Fund: Background and Solvency Issues
RL33514: Social Security: What Would Happen If the Trust Funds Ran Out?
R43542: How Social Security Benefits Are Computed: In Brief
R41962: The Social Security Retirement Age: In Brief
RS22294: Social Security Survivors Benefits
R43637: Social Security: The Lump-Sum Death Benefit
R43615: Social Security: Minimum Benefits
94-803: Social Security: Cost-of-Living Adjustments
98-35: Social Security: The Windfall Elimination Provision (WEP)
RL32453: Social Security: The Government Pension Offset (GPO)
RL32552: Social Security: Calculation and History of Taxing Benefits
RS20479: Social Security: Substantial Gainful Activity for the Blind
RS22220: Social Security Disability Insurance (SSDI): The Five-Month Waiting Period for Benefits
RL33585: Social Security Disability Insurance (SSDI) Demonstration Projects
R41934: Ticket to Work and Self-Sufficiency Program: Overview and Current Issues
R41716: Social Security Administration (SSA): Budget Issues
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures related to Social Security can be found in the CRS reports included in this Green Book chapter.
RL30920: Social Security: Major Decisions in the House and Senate Since 1935
Table 1. Social Security Laws, 1935-2012
R42035: Social Security Primer
Table 1. Increase in the Full Retirement Age Scheduled Under Current Law
Table 2. Computation of a Worker’s Primary Insurance Amount (PIA) in 2014 Based on an Illustrative AIME of $5,000
Table 3. Social Security Benefits for the Worker’s Family Members
Table 4. Social Security Beneficiaries, by Type, June 2014
RL33028: Social Security: The Trust Fund
Table 1. Operations of the Social Security Trust Fund, Historical Period 1957-2013
Table 2. Projected Operations of the Social Security Trust Fund, 2014-2032
Table 3. Accumulated Holdings of the Social Security Trust Fund, Historical Period 1957-2013
Table 4. Projected Accumulated Holdings of the Social Security Trust Fund, 2014-2032
Figure 1. Ratio of Current Non-Interest Income to Costs for the Social Security Trust Fund, 1957-2032
R43318: Social Security Disability Insurance (DI) Trust Fund: Background and Solvency Issues
Table 1. Social Security and Medicare Payroll Tax Rates
Table 2. Annual Operations of the DI Trust Fund, 2003-2013
Table 3. Interfund Loans From the DI and HI Trust Funds to the OASI Trust Fund, 1982
Table 4. Legislative History of Payroll Tax Reallocations Between the OASI and DI Trust Funds
Table 5. OASDI Payroll Tax Rate Reallocations under the Social Security Domestic Employment Reform Act of 1994 (P.L. 103-387)
Table 6. Potential Reallocation of the OASDI Payroll Tax Rate, 2015 and Beyond
Table A-1. Key Dates Projected for the Social Security Trust Funds as Shown Under the Intermediate Assumptions in Trustees Reports from 1983 to 2014
Figure 1. Actual and Projected DI Trust Fund Ratios, 2000-2023
Figure 2. DI Income and Cost Rates, 1990-2013
Figure 3. Actual and Projected OASI, DI, and HI Trust Fund Ratios
Figure A-1. Actual and Projected DI Income and Cost Rates with Scheduled and Payable Benefits, 1970-2090
RL33514: Social Security: What Would Happen If the Trust Funds Ran Out?
Table 1. Current Social Security Benefit Payment Schedule
Figure 1. Social Security Trust Fund Ratios
Figure 2. Payable Benefits as a Share of Scheduled Benefits at Current Law Payroll Tax Rates, 2014-2088
Figure 3. Replacement Rates Under Benefit Cut Scenario, 2014-2088
Figure 4. Initial Real Annual Payable Benefits Under Benefit Cut Scenario, 2014-2088
Figure 5. Combined Payroll Tax Rate Needed To Fund Scheduled Benefits, 2014-2088
R43542: How Social Security Benefits Are Computed: In Brief
Table 1. Computation of a Worker’s Primary Insurance Amount (PIA) in 2014 Based on an Illustrative AIME of $5,000
Table 2. Full Retirement Age (FRA) by Year of Birth
Figure 1. Computation of a Worker’s Primary Insurance Amount (PIA) in 2014
Figure 2. Monthly Retirement Benefit by Claim Age
R41962: The Social Security Retirement Age: In Brief
Table 1. Age to Receive Full Social Security Benefits
Table 2. Benefit Decrease for Early Retirement
Table 3. Benefit Increase for Delayed Retirement
Figure 1. Age Distribution of Retirement Benefit Claims in 2012
RS22294: Social Security Survivors Benefits
Table 1. Survivors Beneficiaries and Benefits
R43637: Social Security: The Lump-Sum Death Benefit
Figure 1. The Diminishing Significance of the Lump-Sum Death Benefit
R43615: Social Security: Minimum Benefits
Table 1. Special Minimum PIA Monthly Benefit Amounts, 2014
Table 2. Number of Special Minimum PIA Beneficiaries and Average Increase in Monthly Benefit, June 2013
94-803: Social Security: Cost-of-Living Adjustments
Table 1. Computation of the Social Security COLA, January 2014
Table 2. Average CPI-W for the Third Quarter, 2007-2013
Table 3. History of Social Security Benefit Increases
98-35: Social Security: The Windfall Elimination Provision (WEP)
Table 1. Social Security Benefit Formula in 2014
Table 2. Monthly PIA for a Worker With Average Indexed Monthly Earnings of $1,500 and Retiring in 2014
Table 3. WEP Reduction Falls with Years of Substantial Coverage
Table 4. Number of Beneficiaries in Current Payment Status with Benefits Affected by Windfall Elimination Provision (WEP), by State and Type of Benefit, December 2013
RL32453: Social Security: The Government Pension Offset (GPO)
Table 1. Dual Entitlement Formula Applied to Spouses
Table 2. GPO Formula for Spouses
Table 3. Dual Entitlement Rule Compared with Government Pension Offset
Table 4. Mary's Spousal Benefit, Before and After GPO Enactment
Table 5. Number of Social Security Beneficiaries Affected by GPO, by State, Type of Benefit, and Offset Status, December 2013
RL32552: Social Security: Calculation and History of Taxing Benefits
Table 1. Calculation of Taxable Social Security and Tier I Railroad Retirement Benefits
Table 2. Example of Calculation of Taxable Social Security Benefits for Single Social Security Recipients with a $15,000 Benefit and Different Levels of Other Income
Table 3. State Income Taxation of Social Security Benefits, Tax Year 2014
Table 4. Projected Number and Percentage of Beneficiaries with Taxable Social Security Benefits by Income Class, 2014
Table 5. Projected Social Security Benefits and Taxes on Social Security Benefits by Income Class, 2014
Figure 1. Taxable Social Security Benefits as Annual Non-Social Security Income Increases
Figure 2. Taxable Social Security Benefits as Total Annual Social Security Benefits Increase
Table 1. Number of SSDI Workers Terminated, by Reason for Termination, 2012
Table 2. Number of Blind and Disabled SSI Recipients (Aged 18-64) Terminated, by Reason for Termination, 2012
Figure 1. SSA’s Disability Determination Process for SSDI and Adult SSI Claimants
Figure 2. SSA’s Disability Determination Process for Child SSI Claimants
Figure 3. SSA’s Appeals Process
Table 1. Computation of “Ms. M.’s” Primary Insurance Amount (PIA) in 2014 Based on Her AIME of $1,6000
Table A-1. Disability and Childcare Dropout Year (CDY) Computation Chart for SSDI Benefits
Figure A-1. Primary Insurance Amounts of Disabled Workers Credited with Childcare Dropout Years (CDYs), 2000-2013
Table 1. Comparison of SSDI and VDC Recipients
Table 2. Comparison of Key SSDI and VDC Program Components
Table 3. General VDC and SSDI Eligibility Determinations for Four Hypothetical Veterans
Figure 1. Social Security Administration's Five-Step Sequential Evaluation Process for Determining Disability
Figure 2. SSDI Appeals Process
Figure 3. Flow Chart of the Various Steps in the VA Appeal Process
RS20479: Social Security: Substantial Gainful Activity for the Blind
Figure A-1. SGA Levels for Blind and Non-Blind Individuals, Calendar Years 1975-2014
Table 1. Estimated Average Monthly Number of Concurrent SSDI and UI Beneficiaries, 2014-2023
Table 2. Proposals to Eliminate or Offset Concurrent Receipt of SSDI and UI Benefits
RL33585: Social Security Disability Insurance (SSDI) Demonstration Projects
Table 1. Legislative History of SSA’s Demonstration Authority
Table 2. Status of SSDI Demonstration Projects
R41934: Ticket to Work and Self-Sufficiency Program: Overview and Current Issues
Table 1. Data on the Ticket to Work Program
Table 2. The Percentage of Disability Beneficiaries Participating in Ticket to Work, Calendar Years 2002-2010
Table 3. Distribution of EN Payments, Calendar Years 2002-2011
Table 4. Employment Outcomes Before and After the July 2008 Regulatory Changes
Table A-1. Side-by-Side Comparison of Key Ticket to Work July 2008 Regulatory Changes
Table B-1. Comparison of Total Potential EN Payments for All Ticket Holders Under Milestone-Outcome and Outcome-Only Payment Systems
Table B-2. Comparison of Total Potential EN Payments for SSDI and SSI Ticket Holders Under Both EN Payment Systems
Table B-3. Breakdown of Milestone-Outcome EN Payment System
Table B-4. Breakdown of Outcome-Only Payment System
Figure 1. Sample Ticket
Figure 2. Ticket to Work Payment Systems for Employment Networks, Calendar Year 2014
Figure 3. New Tickets Assigned, Calendar Years 2004-2010
Figure 4. New Tickets Assigned to ENs, Calendar Years 2004-2010
R41716: Social Security Administration (SSA): Budget Issues
Figure 1. Projected Spending on SSA Programs
Figure 2. SSA Total LAE Budget Authority
Figure 3. SSA Administrative Budget Requests and Appropriations
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following additional tables and figures appear in this section of the Green Book chapter on Social Security.
Figure 1-2. Disability Claims and Appeals in Fiscal Year 2013
Social Security Disability Insurance: Substantial Gainful Activity Amounts
Table 1-9. Monthly Substantial Gainful Activity (SGA) Amounts, 1968-2014
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
This section covers major legislative changes made in the 112th Congress through the first session of the 113th Congress. For a description of legislative changes made in the 95th through 102nd Congresses, please refer to the 1996 Green Book. For legislative changes made in the 103rd Congress, please refer to the 1998 Green Book. For legislative changes made in the 104th through 111th Congresses, please refer to the 2012 Green Book.
Among other provisions, the Temporary Payroll Tax Cut Continuation Act of 2011 extended for two months (i.e., through February 2012) the temporary 2 percentage point reduction in the Social Security payroll tax for employees and the self-employed in effect for calendar year 2011 under Public Law 111-312. The reduced payroll tax rate was applied to the first $18,350 of covered wages (an amount equal to two-twelfths of the 2012 taxable wage base of $110,100). The employer’s share of the payroll tax was not affected. The law provided general revenue transfers to the Social Security trust funds in amounts needed to protect the trust funds from a loss of payroll tax revenues due to the temporary reduction.
Among other provisions, the Middle Class Tax Relief and Job Creation Act of 2012 further extended the temporary 2 percentage point reduction in the Social Security payroll tax for workers (described above) through the end of calendar year 2012. The law provided general revenue transfers to the Social Security trust funds to make up for the foregone payroll tax revenues.
For more information on the legislative history of the Social Security program, see the Social Security Administration website at http://www.ssa.gov/history/law.html.
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
http://www.socialsecurity.gov/policy/rrc/index.html
This page was prepared on August 29, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
Medicare is a nationwide health insurance program for the aged and certain disabled persons. Medicare consists of four distinct parts: Part A (Hospital Insurance, or HI); Part B (Supplementary Medical Insurance, or SMI); Part C (Medicare Advantage, or MA); and Part D (the prescription drug benefit added by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, MMA). The program is administered by the Centers for Medicare & Medicaid Services (CMS). Total program outlays are estimated to reach $618 billion in fiscal year 2014. Net federal outlays, after deduction of beneficiary premiums and other offsetting receipts, are expected to be $518 billion in 2014.
Medicare is administered by CMS within the U.S. Department of Health and Human Services (DHHS). (Prior to June 14, 2001, this agency was known as the Health Care Financing Administration (HCFA).) Day-to-day program operations, including processing benefits and paying claims, are conducted by private Medicare contractors.
Almost all persons age 65 and over are automatically entitled to premium-free Medicare Part A, as they, or their spouses, have at least 40 quarters of Medicare covered employment. Part A also provides coverage, after a 24-month waiting period, for persons under age 65 who are receiving Social Security cash benefits on the basis of disability. Most persons who need a kidney transplant or renal dialysis also may be covered, regardless of age. In 2014, Part A is expected to cover close to 54 million aged and disabled persons (including those with chronic kidney disease). Medicare Part B is voluntary. All persons age 65 and over and all persons enrolled in Part A may enroll in Part B by paying a monthly premium; those with higher incomes pay higher premiums. In 2014, about 49 million aged and disabled persons are enrolled in Medicare Part B.
Approximately 70% of beneficiaries receive covered services through Parts A and B. Together these programs are known as “Original Medicare.” (“Original Medicare” is sometimes referred to as “traditional fee-for-service Medicare” since a separate payment is made for each unit of service.) Medicare beneficiaries who are eligible for Part A and enrolled in Part B have the option of obtaining covered services through private health plans under Part C rather than through Original Medicare. (In this case, monthly per capita payments are made to the health plan.) Approximately 30% of Medicare beneficiaries have elected this option. All beneficiaries can elect to obtain coverage for prescription drugs through private health plans under Medicare Part D. In 2014, about 41 million Medicare beneficiaries (about 75% of those eligible) are enrolled in Medicare Part D.
Part A provides coverage for inpatient hospital services, up to 100 days of post-hospital skilled nursing facility (SNF) care, some home health services, and hospice care. CMS reimburses acute inpatient hospitals, home health agencies, hospice, inpatient psychiatric facilities, inpatient rehabilitation facilities, long-term care hospitals, and skilled nursing facilities under separate prospective payment systems. A prospective payment system (PPS) is a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. Patients must pay a deductible ($1,216 in 2014) each time their hospital admission begins a benefit period. (A benefit period begins when a patient enters a hospital and ends when he or she has not been in a hospital or SNF for 60 days.) The limited numbers of beneficiaries requiring care beyond 60 days are subject to additional charges. Patients requiring SNF care are subject to a daily coinsurance charge for days 21-100 ($152 in 2014). There are no cost-sharing charges for home health care and limited charges for hospice care.
Part B provides coverage for physicians' services, laboratory services, durable medical equipment (DME), hospital outpatient department (OPD) services, and other medical services. The program generally pays 80 percent of Medicare's fee schedule or other approved amount after the beneficiary has met the annual deductible ($147 in 2014). The beneficiary is liable for the remaining 20 percent.
Under Part C, beneficiaries have the option of obtaining covered services through private health plans. Under an agreement with CMS, a plan agrees to provide all services covered under Medicare Parts A and B (except for hospice care) in return for a capitated monthly payment.
Part D provides coverage for outpatient prescription drugs through private prescription drug plans (PDPs) or Medicare Advantage prescription drug (MA-PD) plans. Similar to Part C, Medicare makes monthly payments to Part D plans for each Part D enrollee. All plans are required to meet certain minimum benefit requirements, however there are significant differences among plans in terms of benefit design, drugs included on plan formularies (i.e., list of covered drugs), cost-sharing applicable for particular drugs, and monthly premiums.
Medicare Part A is financed primarily through the HI payroll tax levied on current workers and their employers. Employers and employees each pay a tax of 1.45 percent on all earnings. The self-employed pay a single tax of 2.9 percent on earnings. Beginning in 2013, high-income workers with wages over $200,000 for single filers, and $250,000 for joint filers, pay an additional 0.9 percent in payroll taxes on the income over these thresholds. Revenues are credited to the HI trust fund. The 2014 Medicare Trustees Report estimates that the HI trust fund will be depleted (insolvent) in 2030.
Part B is financed through a combination of monthly premiums levied on program beneficiaries and Federal general revenues. Beneficiary premiums have generally represented about 25 percent of Part B costs; Federal general revenues (i.e., tax dollars) account for most of the remaining 75 percent. Beginning in 2007, higher income individuals pay higher premiums. Revenues are credited to the SMI trust fund.
Part C has no separate financing mechanism. Payments to MA plans are made in appropriate parts from the HI and SMI trust funds. Part D is financed by a combination of beneficiary premiums, general revenues, and state transfer payments. Revenues are credited to a separate account in the SMI trust fund. Beginning in 2011, high-income enrollees pay higher Part D premiums.
This chapter of the Green Book includes links to recent Congressional Research Service (CRS) Reports on Medicare. A Tables and Figures section lists select tables and figures found in these reports. This chapter of the Green Book also includes a Legislative History of Medicare. This chapter concludes with a list of Links to Additional Resources, including links to Medicare administrative and expenditure data and information on specific programs and payment systems published by the Centers for Medicare & Medicaid Services (CMS), the Medicare Payment Advisory Commission (MedPAC), and the Congressional Budget Office (CBO).
This page was prepared on September 3, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Medicare Budgeting and Payments
R43122: Medicare Financial Status: In Brief
RS20946: Medicare: Insolvency Projections
R40082: Medicare: Part B Premiums
R40907: Medicare Physician Payment Updates and the Sustainable Growth Rate (SGR) System
R42401: Medicare’s Skilled Nursing Facility Primer: Benefit Basics and Issues
R42998: Medicare Home Health Benefit Primer: Benefit Basics and Issues
R40611: Medicare Part D Prescription Drug Benefit
RL34592: P.L. 110-275: The Medicare Improvements for Patients and Providers Act of 2008
RL34360: P.L. 110-173: Provisions in the Medicare, Medicaid, and SCHIP Extension Act of 2007
RL31966: Overview of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003
RL30347: Medicare: Changes to Balanced Budget Act of 1997 (BBA 97, P.L. 105-33) Provisions
L97-802: Medicare Provisions in the Balanced Budget Act of 1997 (BBA 97, P.L. 105-33)
This page was prepared on October 23, 2014, for the 2014 version of the House Ways and Means Green Book.
Following is a list of tables and figures related to Medicare that can be found in the CRS reports included in this Green Book chapter.
Table B-1. Part A (Hospitalization Insurance)
Table B-2. Part B (Supplementary Medical Insurance)
Table B-3. Part C (Medicare Advantage)
Figure 1. Projected Medicare Benefit Spending, by Category, FY2014
Figure 2. 2014 Standard Medicare Prescription Drug Benefit
Figure 3. Sources of Medicare Revenue: 2013
R43122: Medicare Financial Status: In Brief
Table 1. Medicare Expenditures and Enrollment: CY2013
Table 2. Current Value of Estimated Medicare Unfunded Obligations and General Revenue Spending
Figure 1. Sources of Medicare Revenues: 2013
Figure 2. Projected Number of Years Until HI Insolvency
Figure 3. Historical and Projected Medicare Expenditures
Figure 4. Medicare Cost and Non-interest Income, by Source as a Percentage of GDP
Table 1. Medicare Data for Calendar Year 2013
Table 2. Unfunded HI Obligations
Table 3. Unfunded Part B and Part D Obligations
Table 4. SMI General Revenues as a Percentage of Personal and Corporate Federal Income Taxes
Table A-1. Medicare Enrollment, 1970-2085
Table B-1. Medicare Income and Expenditures, Calendar Years 1970-2023
Table C-1. Average Medicare Benefit Costs per Beneficiary, Calendar Years 1970-2023
Table D-1. Operation of the Hospital Insurance Trust Fund, Calendar Years 1970-2023
Table E-1. Operation of the Part B Account of the SMI Trust Fund, Calendar Years 1970-2023
Table F-1. Operation of the Part D Account in the SMI Trust Fund, Calendar Years 2004-2023
Table G-1. Projected Hospital Insurance Expenditures as a Percentage of GDP
Table G-2. Projected Supplementary Medical Insurance – Part B as a Percentage of GDP
Table G-3. Projected Supplementary Medical Insurance – Part D as a Percentage of GDP
Table G-4. Projected Total Medicare Expenditures as a Percentage of GDP
Figure 1. Sources of Medicare Revenue: 2013
Figure 2. Total Medicare Expenditures
Figure 3. Short-Term HI Expenditures and Income
Figure 4. HI Trust Fund Assets at Beginning of Year as a Percentage of Annual Expenditures
Figure 5. Long-Range HI Income and Cost as a Percentage of Taxable Payroll
Figure 6. Medicare Cost and Non-interest Income by Source as a Percentage of GDP
RS20946: Medicare: History of Insolvency Projections
Table 1. Year of Projected Insolvency of the Hospital Insurance Trust Fund in Past and Current Trustees Reports
Table A-1. Operation of the Hospital Insurance Trust Fund, Calendar Years 1970-2023
Table B-1. Tax Rates and Maximum Tax Bases
Figure 1. Projected Number of Years Until HI Insolvency
Figure 2. HI Trust Fund Assets at Beginning of Year as a Percentage of Annual Expenditures
R40082: Medicare: Part B Premiums
Table 1. Initial Enrollment Period
Table 2. Monthly Medicare Part B Premiums for 2014
Table 3. Part B Premium Adjustment for Married Beneficiaries Filing Separately for 2014
Table 4. 2014 Medicare Savings Program Eligibility Standards
Table A-1. Monthly Part B Premiums, 1966-2014
Table B-1. Income Levels for Determining Medicare Part B Premium Adjustment and Per Person Premium Amounts
Table B-2. Income Levels for Determining Part B Premium Adjustment for Married Beneficiaries Filing Separately and Associated Premiums
Table C-1. Projected Part B Premiums
Figure 1. Monthly Medicare Part B Premiums
R40907: Medicare Physician Payment Updates and the Sustainable Growth Rate (SGR) System
Figure 1. Two Measures of the Difference Between Cumulative Allowed and Actual Expenditures for Physician Services Under the SGR System
Table 1. Summary of Updates and Legislative Activity
Table 2. Select Legislative Proposals to Modify the SGR Calculation
R42401: Medicare’s Skilled Nursing Facility Primer: Benefit Basics and Issues
Table 1. Aggregate Freestanding SNF Medicare Margins
Figure 1. Medicare-Covered SNF Days per 1,000 Part A Beneficiaries in 2012, by County
Figure 2. SNF Prospective Payment System Formula
Figure 3. FY2015 SNF Prospective Payment System, Urban Example
Figure 4. FY2015 SNF Prospective Payment System, Rural Example
Figure 5. Distribution of Covered SNF Days, by Rehabilitation RUG
R42998: Medicare Home Health Benefit Primer: Benefit Basics and Issues
Table 1. Average Medicare Payment and Visits for the Most Common Principal Diagnoses in 2011
Table 2. Aggregate Freestanding Home Health Agency Medicare Margins, 2003-2011
Figure 1. Home Health Utilization
Figure 2. Home Health Prospective Payment System Formula for Episodes with Five or Greater Visits
Figure 3. CY2014 Home Health Prospective Payment System, Urban Example
Figure 4. CY2014 Home Health Prospective Payment System, Rural Example
Figure 5. Home Health Expenditures by Part A and B, 2001-2011
Figure 6. Standardized Part A Home Health Payments per User in 2011
Figure 7. Standardized Part B Home Health Payments per User in 2011
R40611: Medicare Part D Prescription Drug Benefit
Table 1. Total Medicare Beneficiaries with Prescription Drug Coverage, 2012
Table 2. Medicare Part D Low-Income Subsidy Enrollment
Table 3. Overview of How Medicare Beneficiaries Qualify for LIS
Table 4. Non-Renewing MA-PD and PDP Plans
Table 5. 2014 Monthly Medicare Part D Surcharge
Table 6. Closing the Doughnut Hole
Table 7. Sliding-Scale Premium for Subsidy-Eligible Individuals
Table 8. Part D Standard Benefits, 2014
Table 9. Plan Liability under Risk Corridor Provisions
Table 10. Medicare Part D Risk Corridor Payment Increases and Decreases
Table 11. Statement of Operations of Part D Account, CY2013
Table 12. Comparison of Projected and Actual Part D Enrollment and Spending
Table 13. Comparison of Original CBO Estimates and Actual Part D Costs, FY2004-FY2013
Table A-1. Operation of the Part D Account in the SMI Trust Fund, Calendar Years 2004-2023
Figure 1. Average Annual Part D Basic Monthly Premium
Figure 2. 2014 Standard Medicare Prescription Drug Benefit
Figure 3. Closing the Doughnut Hole
Figure 4. Utilization Controls in Part D PDP Plans
Figure 5. Medicare Part D Plans, by Year
Table 1. Select Original Medicare Cost-Sharing Levels, 2013
Table 2. Standard Medigap Plans, Effective On or After June 1, 2010
Figure 1. Sources of Supplemental Coverage Among Medicare Beneficiaries, 2009
Figure 2. Distribution of Current Medigap Plans, All Medigap Beneficiaries, 2012
Figure 3. Medigap Enrollment, by State, 2012
Figure 4. Percent of Medicare Enrollees with Medigap Coverage, by State, 2012
Table B-1. Timeline for Update Reductions Including Productivity Adjustments, by Provider
Table C-1. Start Date, Effective Date, or Deadline—Prior to 2010
Table C-2. Start Date, Effective Date, or Deadline—CY2010
Table C-3. Start Date, Effective Date, or Deadline—CY2011
Table C-4. Start Date, Effective Date, or Deadline—CY2012
Table C-5. Start Date, Effective Date, or Deadline—CY2013
Table C-6. Start Date, Effective Date, or Deadline—CY2014
Table C-7. Start Date, Effective Date, or Deadline—CY2015
Table C-8. Start Date, Effective Date, or Deadline—CY2016
Table C-9. Start Date, Effective Date, or Deadline—CY2017
Table C-10. Start Date, Effective Date, or Deadline—CY2018
Table C-11. Start Date, Effective Date, or Deadline—CY2019
Table C-12. Start Date, Effective Date, or Deadline—CY2020
Table C-13. Unspecified Start Date, Effective Date, or Deadline
Figure 1. Estimates of Medicare Spending FY2010-FY2019
L97-802: Medicare Provisions in the Balanced Budget Act of 1997 (BBA 97, P.L. 105-33)
Table 1. Medicare Outlays
Table 2. Estimated Medicare Outlays Under Current Law (Prior to Enactment of BBA), FY1997-FY2007
Table 3. Estimated Medicare Part B Monthly Premium
Table 4. Transition to Annual Coordinated Election of Medicare+Choice Plans
Table 5. Beneficiary Cost-Sharing and Provider Reimbursement Under Medicare+Choice Plans for Basic Benefit Package
Table 6. Major Factors for Determining Medicare Payments to Medicare+Choice Plans
Table 7. CBO Estimate of Medicare Savings in the Balanced Budget Act of 1997, FY1998-FY2002
Table 8. Impact of BBA 97 on Medicare, FY1997-FY2002
Figure 1. Estimate of Medicare Savings in Conference Agreement on BBA 1997
This page was prepared on October 23, 2014, for the 2014 version of the House Ways and Means Green Book.
This section summarizes major Medicare legislation enacted into law during the second session of the 112th Congress through October of the second session of the 113th Congress. Previous editions of the Green Book review legislation enacted prior to that date. The summary highlights major provisions; it is not a comprehensive list of all Medicare amendments. Included are provisions which had a significant budget impact, changed program benefits, modified beneficiary cost sharing, or involved major program reforms. Provisions involving policy changes are mentioned the first time they are incorporated in legislation, but not necessarily every time a modification is made. The descriptions include either the initial effective date of the provision or, in the case of budget savings provisions, the fiscal years for which cuts were specified.
Hospitals
Extended the Medicare Dependent Hospital Program (MDH) through FY2013 to allow qualifying small rural hospitals with a high proportion of Medicare patients to continue receiving Medicare payment adjustments. Extended the additional Medicare payment for inpatient services for low-volume hospitals through FY2013. Under the low-volume hospital extension, hospitals with fewer than 1,600 Medicare discharges and that are 15 miles or more from the nearest like hospital receive a graduated payment adjustment of up to 25%. Upon expiration, the adjustment will revert to original standards of fewer than 200 total discharges and more than 25 road miles.
Authorized the Secretary of HHS to reduce inpatient prospective payment system (IPPS) rates for hospital discharges occurring during FY2014 through FY2017 in order to recoup $11 billion in overpayments related to documentation and coding adjustments for discharges occurring during FY2008 to FY2010 under the Medicare Severity Diagnosis Related Group (MS-DRG) system that did not reflect real changes in patient case-mix.
Hospital Outpatient Departments
Reduced payments for certain stereotactic radiosurgery services furnished under the hospital outpatient department prospective payment system furnished on or after April 1, 2013.
Physicians
Extended Medicare physician payment rates without change through 2013. Authorized eligible health care professionals who participate in a qualified clinical data registry to receive Medicare incentive payments for reporting on quality measures. Maintained through 2013 the 1.0 floor for the work geographic practice cost index (GPCI) in determining relative values for physicians' services under the Medicare physician payment system.
Therapy Services
Revised requirements for Medicare payments for outpatient therapy services, including extending through December 31, 2013 the process allowing exceptions to limits (caps) on medically necessary outpatient therapy services. Made reductions to Medicare payments for multiple therapy services provided to the same patient on the same day for services provided on or after April 1, 2013.
Ambulance Services
Extended the temporary increases in payment for ground ambulance services in urban and rural areas and the increase in the assistance for rural ambulance providers furnishing services in low-population density areas (super rural adjustment) through December 31, 2013. Extended the increase in payment for certain urban air ambulance services until June 30, 2013. Reduced Medicare payments by 10% for ambulance services consisting of non-emergency basic life support services involving transport of an individual with end-stage renal disease (ESRD) for renal dialysis services furnished other than on an emergency basis by a provider of services or a renal dialysis facility. Mandated two studies on the use and feasibility of using cost report data to analyze cost variation by type of ambulance provider and the appropriateness of the ambulance fee schedule add-ons.
Dialysis Services
Required the Secretary to make reductions in Medicare payments for renal dialysis services provided on or after January 1, 2014 to account for changes in the utilization of certain drugs and biologicals. Delayed the incorporation of oral-only ESRD related drugs into the ESRD bundled payment system to January 1, 2016. Directed the Government Accountability Office (GAO) to update its prior report to Congress on the impact of including specified oral drugs furnished for the treatment of end-stage renal disease in the ESRD bundled prospective payment system on Medicare beneficiary access to high-quality dialysis services.
Durable Medical Equipment
Made Medicare reimbursement for non-mail-order diabetic supplies equal to the single payment amounts established under the national mail-order competition for diabetic supplies.
Imaging Services
Revised equipment utilization rates for purposes of Medicare payment for advanced diagnostic imaging services for 2014 and subsequent years.
Medicare Advantage
Extended authorization of Medicare Advantage plans that exclusively serve special needs individuals (SNPs) through December 31, 2014. Extended the authorization for reasonable cost contract plans to serve without restrictions through December 31, 2013. Revised the health status coding adjustment factor used in determining payments to Medicare Advantage plans.
Program Integrity
Extended from three years to five years the length of time the Secretary has to collect Medicare overpayments.
Medicare Improvement Fund
Eliminated funding for the Medicare Improvement Fund for FY2014 and FY2015.
Sequestration
Extended sequestration for direct spending, including Medicare, for an additional two years, through FY2023. The percentage reductions in FY2022 and FY2023 are to be the same percent as the corresponding percentage reductions for such spending in FY2021. In FY2023, the Medicare payment reductions are to be 2.90% for the first six months in which the sequestration order is effective and, for the second six months, the payment reduction is to be 1.11%.
Hospitals
Extended the Medicare Dependent Hospital Program (MDH) to allow qualifying small rural hospitals with a high proportion of Medicare patients to continue receiving payment adjustments, and extended the Medicare inpatient hospital payment adjustment for low-volume hospitals both through March 31, 2014 and retroactive to October 1, 2013. Under the low-volume hospital extension, hospitals with fewer than 1,600 Medicare discharges and that are 15 miles or more from the nearest like hospital receive a graduated payment adjustment of up to 25%. Upon expiration, the adjustment will revert to original standards of fewer than 200 total discharges and more than 25 road miles.
Created criteria for the types of patients for whom care may be paid at the higher Medicare long-term care hospital (LTCH) rate, limiting such payments to patients with stays longer than 3 days in an intensive care unit or who receive significant ventilator services in a LTCH. Beginning in FY2016, services provided to patients not meeting this criteria or who are primarily rehabilitation or psychiatric patients are to be paid at lower rates that are comparable to the inpatient rate paid at acute care hospitals. There will be a 2-year transition period in FY2016 and FY2017 when blended payments will apply. Beginning in FY2020, LTCHs that have over 50% of their discharges paid at the lower rate during a cost reporting period will be paid under the IPPS in the following cost reporting period. Amended the Medicare, Medicaid, and SCHIP Extension Act of 2007 to extend for an additional 4 years: 1) certain rules for payments to LTCH hospitals-within-hospitals, and 2) the delay in the 25% patient threshold payment adjustment. Reinstated from January 1, 2015 through September 1, 2017 the moratorium on the expansion or establishment of LTCHs.
Physicians
Provided a 0.5% update to the single conversion factor in the sustainable growth rate (SGR) formula used to determine Medicare physician payments, from January 1, 2014 through March 31, 2014. Extended through March 31, 2014, the 1.0 floor for the work geographic practice cost index (GPCI) in determining relative values for physicians' services under the Medicare physician payment system.
Therapy Services
Extended through March 31, 2014, the process for allowing exceptions to the dollar amount caps on Medicare coverage of medically necessary outpatient therapy services.
Ambulance Services
Extended through March 31, 2014, the increased payments for certain ground ambulance services and for super rural ambulance services in low-population density areas.
Medicare Advantage
Extended the authorization for specialized Medicare Advantage plans for special needs individuals through December 31, 2015. Extended the authorization for reasonable cost contract plans to serve without restrictions through December 31, 2014.
Sequestration
Extended sequestration for direct spending, including Medicare, for an additional year—through FY2024.
Medicare Improvement Fund
Replaced the requirement to establish a Medicare Improvement Fund with one that requires the Secretary of HHS to establish a Transitional Fund for Sustainable Growth Rate (SGR) Reform, available to provide funds to pay for physicians' services under part B to supplement the conversion factor for 2017 if the conversion factor for that year is less than that for 2013. Made monies available to the Fund from the Federal Supplementary Medical Insurance Trust Fund for expenditures during or after 2017.
Sequestration
Adjusted the Medicare sequestration reductions in FY2024 to 4% for the first 6 months following the President’s sequestration order, and 0% for the last 6 months.
Hospitals
Extended the increased Medicare inpatient hospital payment adjustments for low-volume hospitals to April 1, 2015, and extended the Medicare-Dependent Hospital (MDH) program to April 1, 2015 to allow qualifying small rural hospitals with a high proportion of Medicare patients to continue receiving Medicare payment adjustments. Under the low-volume hospital extension, hospitals with fewer than 1,600 Medicare discharges and that are 15 miles or more from the nearest like hospital receive a graduated payment adjustment of up to 25%. Upon expiration, the adjustment will revert to original standards of fewer than 200 total discharges and more than 25 road miles.
Provided for technical corrections to the new long-term care hospital (LTCH) criteria enacted in the 2014 Continuing Appropriations Resolution. Moved up the start date of the moratorium on new LTCHs and LTCH expansions to the date of enactment (April 1, 2014) from January 1, 2015. Allowed for exceptions to the moratorium on new LTCHs for those LTCHs that, on or before the date of enactment, have already started construction, have begun their qualifying period, or have obtained a certificate of need.
Authorized the Secretary of HHS to continue through June 2015 certain medical review activities related to the Medicare two-midnight rule, but delayed related Recovery Audit Contractor (RAC) post-payment reviews through March 31, 2015 unless there is evidence of systemic gaming, fraud, abuse or delays in the provision of care by a provider of service. (Under the Medicare two-midnight rule, inpatient admissions are presumed to be medically appropriate if a physician expects a beneficiary’s treatment to require a two-night hospital stay and admits the patient under that assumption.)
Skilled Nursing Facilities
Required the establishment of a new skilled nursing facility value-based purchasing system (SNF VBP), beginning during or after FY2019, under which SNFs are to be evaluated and scored based on performance standards established by the Secretary. The Secretary is to develop an all-cause, all-condition readmission measure not later than October 1, 2015, which is to be replaced by an all-condition, risk-adjusted, potentially preventable hospital readmission rate for SNFs as soon as practicable.
SNFs are to be ranked from high to low on these performance measures; SNFs determined as high-performing will receive value-based incentive payments in addition to their per diem payments, while SNFs in the lowest 40% of the ranking will receive a reduction in their Medicare payment rates. Each SNF’s performance score and ranking is to be made publically available on the Nursing Home Compare website no later than October 1, 2017. The program is to be funded through a portion of a 2% reduction in Medicare SNF per diem payments; and, between 50% and 70% of the 2% reduction applied each year is to be allocated for value-based incentive payments. The remaining portion of the 2% reduction will be retained as savings to the Medicare program.
Physicians
Extended the 0.5% update to the single conversion factor in the sustainable growth rate (SGR) formula scheduled for January through March of 2014 through the rest of CY2014, and provided a 0% update for January 1, 2015 through March 31, 2015. Extended the 1.0 floor for the physician work geographic practice cost index (GPCI) through March 31, 2015.
Authorized the Secretary to collect and use certain information on physicians’ resource use for services paid under the physician fee schedule such as time involved in furnishing services; amounts, types and prices of practice expense inputs; and overhead and accounting information. Authorized the Secretary to use this information in determining the relative values in the formula for setting physician’s fees.
Revised and expanded the criteria for codes to be reviewed when identifying potentially misvalued codes. Set an annual target rate for relative value adjustments for misvalued services for years 2017-2020. For codes with relative value unit reductions of 20% or more compared with the previous year, the reductions are to be phased in over a 2 year period.
Therapy Services
Extended the therapy cap exceptions process through March 31, 2015.
Dialysis Services
Amended the American Taxpayer Relief Act of 2012 (ATRA) to delay the inclusion of oral-only end stage renal disease (ESRD) related drugs in the ESRD prospective payment system’s bundled payments until January 1, 2024. Required the Secretary to establish a process for (1) determining when a product is no longer an “oral only” drug, and (2) including new injectable IV products into the bundled payment Eliminated the remaining reductions required by ATRA; instead, the annual payment increase in 2015 is to be 0%, in 2016 and 2017 payments will be reduced by 1.25%, and in 2018, by 1%. Beginning in 2016, the ESRD Quality Incentive Program (established by MIPPA) is to include to the extent feasible outcomes-based measures specified by the Secretary that are based on conditions treated with oral-only drugs.
Ambulance Services
Extended the increased payments for ground ambulance and super rural ground ambulance services to April 1, 2015.
Imaging Services
Prescribed a new quality incentive payment policy for certain computed tomography (CT) services. In 2016, payments are to be reduced by 5%, and in 2017 and thereafter by 15%, for specified CT services furnished using equipment that does not meet certain radiation dose safety standards.
Directed the Secretary through rulemaking to specify appropriate use criteria (AUC) for imaging services. Beginning in 2017, CMS is to only allow payments to the furnishing professional for an applicable advanced diagnostic imaging service if the service claim includes certain information including information about whether the service adheres to the applicable AUC. Also beginning in 2017, the Secretary is to identify ordering physicians with low adherence to applicable AUCs, and beginning January 1, 2020, such physicians will be required to obtain prior authorization from CMS for applicable imaging services.
Laboratory Services
Prescribed requirements for the establishment of Medicare payment rates for clinical diagnostic laboratory tests based on private sector payment rates starting in 2017; if the rates determined under the new methodology are significantly lower than existing rates, the reductions will be phased in over a specified time period.
Codified the CMS process for determining payment rates for new or substantially revised clinical diagnostic lab tests that are not advanced tests, and required a public explanation of the payment rates.
Revised the payment methodology for new advanced diagnostic laboratory tests (tests that are furnished by the laboratory that developed them and involve patient specific analysis of multiple biomarkers of DNA, RNA, or unique protein combinations; or that have been cleared or approved by the FDA; or that meet similar criteria established by the Secretary). New advanced diagnostic lab tests furnished only by the original developing laboratory will be paid the actual list charge (the publically available rate) for the first 9 months, and paid based on the new private sector payment methodology thereafter. Required that Medicare administrative contractors issue local coverage determinations for clinical diagnostic tests in accordance with certain standards.
Medicare Advantage
Extended specialized Medicare Advantage plans for special needs individuals through December 31, 2016, and the authority for reasonable cost contract plans to serve without restrictions through December 31, 2015.
Transitional Fund for Sustainable Growth Rate (SGR) Reform
Eliminated funding for the Transitional Fund for Sustainable Growth Rate Reform which was created by P.L. 113-82.
Post-Acute Care Providers
Required that post-acute care (PAC) providers (defined as long-term care hospitals (LTCHs), inpatient rehabilitation facilities (IRFs), skilled nursing facilities (SNFs), and home health agencies (HHAs)) report standardized patient assessment data, data on quality measures, and data on resource use and other measures, all of which meet specified requirements. Required the data to be standardized and interoperable to allow for exchange of longitudinal information among PAC and other providers to better enable them to coordinate care, improve Medicare beneficiary outcomes, and enhance discharge planning. Required PAC providers to report the standardized patient assessment data (at minimum for patient admissions and discharges) by October 1, 2018 for LTCHs, IRFs, and SNFs, and by January 1, 2019 for HHAs. Also required the Secretary by those same dates to ensure a match between the patient assessment data submission and claims data submitted for that patient.
Required specified resource use data to be submitted beginning October 1, 2016 for LTCHs, IRFs, and SNFs, and January 1, 2017 for HHAs. Required the phase-in of submissions for quality data from October 1, 2016 through October 1, 2018 for LTCHs, IRFs, and SNFs, and January 1, 2017 through January 1, 2019 for HHAs. Required the Secretary, beginning one year after the specified application date, to provide confidential feedback reports to PAC providers on their performance with respect to the quality and resource measures, and no later than two years after the specified application date for these measures, to publically report PAC provider performance on these measures.
Established that conditions of participation for PAC providers, acute care hospitals and critical access hospitals be modified by January 1, 2016 to require use of standardized data as well as quality and resource measures in their discharge planning processes. Directed the Secretary to reduce by 2 percentage points the update to the market basket percentage for SNFs which do not report the required data, and incorporated these data requirements in existing update penalty programs for other PAC providers. Required the Medicare Payment Advisory Commission (MedPAC) and the Secretary to conduct a series of reports using existing data and the new information collected to evaluate and recommend features of a new PAC payment system.
Hospice
Required that beginning 6 months after the date of enactment and ending September 30, 2025, hospices be surveyed by an appropriate State or local survey agency, or an approved accreditation agency, at least once every 3 years. Prescribed the annual update to the hospice aggregate payment cap amount for FY2017 through FY2025 as the percentage update to payment rates for hospice care or services furnished during the fiscal year beginning on the October 1 preceding the beginning of the accounting year.
Transitional Fund for Sustainable Growth Rate (SGR) Reform
Replaced the Transitional Fund for SGR Reform with a re-established Medicare Improvement Fund (MIF). Made funds of $195 million available to the MIF from the Medicare Hospital Insurance and Supplementary Medical Insurance Trust Funds during and after FY2020. The funds are to be used by the Secretary to make improvements under the original Medicare fee-for-service program for individuals entitled to, or enrolled for, benefits under part A or enrolled under Medicare part B.
This page was prepared on November 21, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Centers for Medicare & Medicaid Services (CMS)
National Health Expenditure Data. Data includes historical and projected spending measures on annual health spending in the U.S. by type of service delivered (hospital care, physician services, nursing home care, etc.) and source of funding for those services (private health insurance, Medicare, Medicaid, out-of-pocket spending, etc.).
CMS Statistics. Summary information about health expenditures and the Medicare and Medicaid programs.
CMS Data Compendium. Contains historic, current, and projected data on Medicare enrollment and Medicaid recipients, expenditures, and utilization. Also includes data pertaining to budget, administrative and operating costs, individual income, financing, and health care providers and suppliers are also included.
Medicare and Medicaid Statistical Supplement. The Medicare and Medicaid Statistical Supplement contains approximately 300 pages of statistical information about Medicare, Medicaid, and other Centers for Medicare & Medicaid Services (CMS) programs. The Supplement includes charts and tables showing health expenditures for the entire U.S. population, characteristics of the covered populations, use of services, and expenditures under these programs.
Medicare Trustees Reports. Detailed, lengthy document, containing a substantial amount of data on the past and estimated future financial operations of the Medicare Hospital Insurance and Supplementary Medical Insurance Trust Funds.
Medicare Enrollment. This site contains various Medicare enrollment tables. It includes national and state enrollment trends, state enrollment by aged, disabled and all, as well as county level enrollment.
Medicare Current Beneficiary Survey (MCBS). MCBS is a continuous, multipurpose survey of a nationally representative sample of aged, disabled, and institutionalized Medicare beneficiaries. MCBS, which is sponsored by CMS, is the only comprehensive source of information on the health status, health care use and expenditures, health insurance coverage, and socioeconomic and demographic characteristics of the entire spectrum of Medicare beneficiaries.
Fee-for-Service Statistics Utilization statistics for Medicare Parts A and B. Tables for Medicare utilization for Part A and Medicare utilization for Part B are included. Information included for hospitals, home health agencies, hospice, skilled nursing facilities, physician and other Part B services.
Prospective Payment Systems. A Prospective Payment System (PPS) is a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. CMS uses separate PPSs for reimbursement to acute inpatient hospitals, home health agencies, hospice, hospital outpatient, inpatient psychiatric facilities, inpatient rehabilitation facilities, long-term care hospitals, and skilled nursing facilities. Links to information about each specific PPS.
Fee Schedules. Listing of fee maximums used to reimburse a physician and/or other providers on a fee-for-service basis. MS develops fee schedules for physicians, ambulance services, clinical laboratory services, and durable medical equipment, prosthetics, orthotics, and supplies. Links to information about each specific fee schedule.
Physician Fee Schedule. Contains information on payments under the physician fee schedule and related information concerning the development of the payment amounts.
Medicare Advantage and Medicare Part D Contract and Enrollment Data. The Medicare Advantage (MA) / Part D Contract and Enrollment Data section is a centralized repository for publicly available data on contracts and plans, enrollment numbers, service area data, and contact information for MA, Prescription Drug Plan (PDP), cost, PACE, and demonstration organizations. Data is broken down by state, county and contract. Also provides annual Medicare Health Plan Employer Data and Information Set (HEDIS) performance measures.
Medicare Advantage Rates and Statistics. Contains information on MA payment methodology, rate calculation data, benchmarks, risk adjustment, and fee-for-service expenditure data by county.
Medicare Prescription Drug Benefit. Includes links to data on drug plan availability, premium information, Part D enrollment, and coverage gap spending.
Congressional Budget Office (CBO)
Collection of CBO Medicare related publications including reports and cost-estimates (scores) on recent legislation
2014 Long-Term Budget Outlook including forecasts of Medicare spending and its relationship to total federal spending and GDP
Medicare Payment Advisory Commission (MedPAC)
Data Book: Health Care Spending and the Medicare Program, June 2014
June 2014 Report to Congress, Medicare and the Health Care Delivery System
March 2014 Report to Congress, Medicare Payment Policy
Kaiser Family Foundation State Health Facts: Medicare Data
Kaiser Family Foundation Health and Prescription Drug Plan Tracker
This page was prepared on September 3, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The Supplemental Security Income (SSI) program is a means tested, federally-administered income assistance program authorized by Title XVI of the Social Security Act. Established in 1972 (Public Law 92-603), with benefits first paid in 1974, SSI provides monthly cash payments in accordance with uniform, nationwide eligibility requirements to needy aged, blind, and disabled persons. In July 2014, there were 8.4 million SSI recipients receiving $4.7 billion in monthly benefit payments.
The SSI program replaced the federal-state programs of Old Age Assistance and Aid to the Blind established by the original Social Security Act of 1935, as well as the program of Aid to the Permanently and Totally Disabled established by the Social Security Amendments of 1950. Under these programs, federal matching funds were offered to the states to enable them to give cash relief, “as far as practicable” in each state, to eligible persons whom the states deemed needy. The states set benefit levels and administered these programs. These federal-state adult assistance programs continue to operate in Guam, Puerto Rico, and the Virgin Islands. Under the Covenant to Establish a Commonwealth of the Northern Mariana Islands, enacted as Public Law 94-241 on March 24, 1976, the Northern Mariana Islands is the only jurisdiction outside the 50 states and the District of Columbia in which residents are eligible for the SSI program.
The Congress intended the new SSI program to be more than just a federal version of the former state adult assistance programs, which it replaced. In describing the new program, the report of the Committee on Finance stated:
The Committee bill would make a major departure from the traditional concept of public assistance as it now applies to the aged, the blind, and the disabled. Building on the present Social Security program, it would create a new federal program administered by the Social Security Administration (SSA), designed to provide a positive assurance that the nation's aged, blind, and disabled people would no longer have to subsist on below poverty level incomes (Senate Report No. 92-1230, p. 384; U.S. Senate, Committee on Finance, Sept. 26, 1972).
The SSI program was envisioned as a basic national income maintenance system for the aged, blind, and disabled, which would differ from the state programs it replaced in a number of ways. It would be administered by SSA in a manner as comparable as possible to the way in which benefits were administered under the Social Security Old-Age, Survivor, and Disability Insurance (OASDI) programs. While it was understood that modifications would be necessary to make SSA's systems work for the new program, SSI was seen as an add-on rather than a new system.
Under the former adult assistance programs, the amount of assistance could vary from person to person according to an evaluation of the individual's needs. The SSI program, by contrast, represented a “flat grant” approach in which there would be a uniform federal income support level.
It should be noted that even though SSA administers the SSI program, SSI is not the same as Social Security. The SSI program is funded by general revenues of the U.S. Treasury – which are comprised of personal income taxes, corporate taxes, and other taxes. Social Security benefits are funded by the Social Security taxes paid by workers, employers, and self-employed persons. The programs also differ in other ways such as the conditions of eligibility and the method of determining payments. In addition, states have the option of supplementing the basic federal SSI payment. In some cases, state supplementary payments are administered by the state instead of SSA.
This chapter of the Green Book includes a series of Congressional Research Service (CRS) Reports organized under the following general headings:
Readers should consult the reports listed under each of these headings for information and data related to these topics. A Tables and Figures section provides a list of the tables and figures included in the CRS reports, and a separate section includes Additional Tables and Figures related to SSI, followed by a Legislative History and Links to Additional Resources.
This page was prepared on August 18, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. Certain CRS reports with cover dates earlier than 2014 are included here because their content remains relevant.
94-486: Supplemental Security Income (SSI)
R41934: Ticket to Work and Self-Sufficiency Program: Overview and Current Issues
R41716: Social Security Administration (SSA): Budget Issues
94-803: Social Security: Cost-of-Living Adjustments
This page was prepared on August 18, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures related to SSI can be found in the CRS reports included in this chapter of the Green Book.
RL32279: Primer on Disability Benefits: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI)
Table 1. Number of SSDI Workers Terminated, by Reason for Termination, 2012
Table 2. Number of Blind and Disabled SSI Recipients (Aged 18-64) Terminated, by Reason for Termination, 2012
Figure 1. SSA’s Disability Determination Process for SSDI and Adult SSI Claimants
Figure 2. SSA’s Disability Determination Process for Child SSI Claimants
Figure 3. SSA’s Appeals Process
R41934: Ticket to Work and Self-Sufficiency Program: Overview and Current Issues
Figure 1: Sample Ticket
Figure 2. Ticket to Work Payment Systems for Employment Networks, Calendar Year 2014
Figure 3. New Tickets Assigned, Calendar Years 2004-2010
Figure 4. New Tickets Assigned to ENs, Calendar Years 2004-2010
Table 1. Data on the Ticket to Work Program
Table 2. The Percentage of Disability Beneficiaries Participating in Ticket to Work, Calendar Years 2002-2010
Table 3. Distribution of EN Payments, Calendar Years 2002-2011
Table 4. Employment Outcomes Before and After the July 2008 Regulatory Changes
Table A1: Side-by-Side Comparison of Key Ticket to Work July 2008 Regulatory Changes
R41716: Social Security Administration (SSA): Budget Issues
Figure 1. Projected Spending on SSA Programs
Figure 2. SSA Total LAE Budget Authority
Figure 3. SSA Administrative Budget Requests and Appropriations
94-803: Social Security: Cost-of-Living Adjustments
Table 1. Computation of the Social Security COLA, January 2014
Table 2. Average CPI-W for the Third Quarter, 2007-2013
Table 3. History of Social Security Benefit Increases
This page was prepared on August 18, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
Table 3-1. Maximum Income for Eligibility for Federal SSI Benefits, 2014
Table 3-7. SSI Recipients Under Age 65 by Diagnostic Group, December 2013
Table 3-8. Representative Payee Status of SSI Recipients by Age Group, December 2013
Table 3-12. Total Federally-Administered SSI Payments by State, 2013
Table 3-13. Total Federally-Administered SSI Payments, Selected Years 1974-2013
This page was prepared on September 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following provides a legislative history of Supplemental Security Income from the 112th Congress through the first session of the 113th Congress. For prior history from 1972-1995, please see the 1996 edition of the Green Book. For prior history from 1996 to 2010, please see the 2012 edition of the Green Book.
Public Law 112-74 included a $2 million appropriation for the Department of Education for activities aimed at improving the outcomes of children receiving SSI and their families, which may include competitive grants to states to improve the provision and coordination of services for SSI child recipients in order to achieve improved health status. This program was known as Promoting Readiness of Minors in Supplemental Security Income (PROMISE).
Public Law 112-240 provided for a permanent extension of the income and 12-month resource exclusions of all refundable federal and advanced tax credits for the purposes of determining eligibility or payment amount for all federal programs, including SSI.
This page was prepared on August 18, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
U.S. Social Security Administration, SSI Annual Statistical Report, 2013
U.S. Social Security Administration, Annual Statistical Supplement, 2013
U.S. Social Security Administration, SSI Annual Report, 2014
This page was prepared on August 18, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
A variety of benefits may be available to unemployed workers to provide them with income support during a spell of involuntary unemployment. The primary source of this support is the joint federal-state Unemployment Compensation (UC) program, which may provide income through the payment of state UC benefits for up to a maximum of 26 weeks in most states.[1] Other programs that may provide workers with income are more specialized. They may target special groups of workers, be automatically triggered by certain economic conditions, be temporarily created by Congress with a set expiration date, or target typically ineligible workers through a disaster declaration.
Originally, one purpose of the UC program, among other things, was to help counter economic fluctuations such as recessions.[2] This intent is reflected in the current UC program’s funding and benefit structure. When the economy grows, UC program revenue rises through increased tax revenues while UC program spending falls as fewer workers are unemployed. The effect of collecting more taxes than are spent dampens demand in the economy. This also creates a surplus of funds or a “cushion” of available funds for the UC program to draw upon during a recession. In a recession, UC tax revenue falls and UC program spending rises as more workers lose their jobs and receive UC benefits. The increased amount of UC payments to unemployed workers dampens the economic effect of earnings losses by injecting additional funds into the economy.
UC benefits may be extended at the state level by the permanent Extended Benefit (EB) program if high unemployment exists within the state. Once regular unemployment benefits are exhausted, the EB program may provide up to an additional 13 or 20 weeks of benefits, depending on worker eligibility, optional state laws, and economic conditions in the state. The EB program is funded 50% by the federal government and 50% by the states, although the 2009 stimulus package (P.L. 111-5, as amended) and subsequent law temporarily provided for 100% federal funding of the EB program from February 2009 through December 2013.
In addition, Congress can authorize temporary unemployment insurance programs: most recently, the Emergency Unemployment Compensation (EUC08) program, which began in July 2008 and expired at the end of December 2013. The EUC08 benefit was 100% federally funded. State UC agencies administered the EUC08 benefit along with regular UC benefits and the EB program. The creation of the EUC08 program was the eighth time Congress created a federal temporary program to extend unemployment compensation during an economic slowdown.[3]
The underlying framework of the UC system is contained in the Social Security Act (the Act). Title III of the Act authorizes grants to states for the administration of state UC laws, Title IX authorizes the various components of the federal Unemployment Trust Fund (UTF), and Title XII authorizes advances or loans to insolvent state UC programs. The EB program was established by the Federal-State Extended Unemployment Compensation Act of 1970 (EUCA), P.L. 91-373 (26 U.S.C. 3304, note). The EUC08 program was temporarily authorized by the Supplemental Appropriations Act of 2008 (P.L. 110-252), as amended.
The federal government appropriates funds for federal and state UC program administration, the federal share of EB payments, EUC08 benefits, and federal loans to insolvent state UC programs. In FY2013, states received $4.8 billion from the federal government for the administration of their UC programs, $0.1 billion for the federal share of EB payments, and $25.4 billion for the temporary, federally financed EUC08 program. In FY2014, states will receive a projected $4.3 billion from the federal government for the administration of their UC programs, $0.01 billion for the federal share of EB payments, and $5.4 billion for the temporary EUC08 program, which was authorized through December 2013.
The U.S. Department of Labor (DOL) administers the federal portion of the UC system, which operates in each state, the District of Columbia, Puerto Rico, and the Virgin Islands. Federal law sets broad rules that the 53 state programs must follow. These include the broad categories of workers that must be covered by the program, the method for triggering the EB program, the floor on the highest state unemployment tax rate to be imposed on employers (5.4%), and how the states will repay UTF loans. If the states do not follow these rules, their employers may lose a portion or all of their state unemployment tax credit when their federal unemployment tax is calculated – potentially increasing the net federal tax from the current 0.6% tax faced by employers in most states by up to an additional 5.4% in certain situations. The federal tax pays for both federal and state administrative costs, the federal share of the EB program, loans to insolvent state UC accounts, and state employment services.
This chapter of the Green Book includes a series of Congressional Research Service (CRS) Reports organized under the following general headings.
· Unemployment Insurance: Programs and Benefits
· Unemployment Trust Fund and Financing
· Other Unemployment Benefits and Alternative Programs
Readers should consult the reports listed under each of these headings for information and data related to these topics. Separate sections identify Tables and Figures included in the CRS reports and also provide Additional Tables and Figures related to the UI program. Additional sections include Legislative History and Links to Additional Resources.
This page was prepared on August 29, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
[1] Other exceptions include: up to 30 weeks in Massachusetts; up to 28 weeks in Montana; up to 25 weeks in Arkansas and Illinois; up to 20 weeks in Michigan, Missouri, and South Carolina; a maximum of 12-23 weeks in Florida, depending on the state unemployment rate; a maximum of 14-20 weeks in Georgia, depending on the state unemployment rate; a maximum of 16 weeks, 20 weeks, or 26 weeks in Kansas, depending on the state unemployment rate; and a maximum of 12-20 weeks in North Carolina, depending on the state unemployment rate. For more details, see CRS Report R41859, Unemployment Insurance: Consequences of Changes in State Unemployment Compensation Laws, by Katelin P. Isaacs.
[2] See, for example, President Franklin Roosevelt’s remarks at the signing of the Social Security Act at http://www.ssa.gov/history/fdrstmts.html#signing.
[3] The other temporary programs became effective in 1958, 1961, 1972, 1975, 1982, 1991, and 2002. For details on these programs, see RL34340, Extending Unemployment Compensation Benefits During Recessions.
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The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. Certain CRS reports with cover dates earlier than 2014 are included here because their content remains relevant.
RL33362: Unemployment Insurance: Programs and Benefits
R42444: Emergency Unemployment Compensation (EUC08): Status of Benefits Prior to Expiration
R42936: Unemployment Insurance: Legislative Issues in the 113th Congress
R41662: Unemployment Insurance: Legislative Issues in the 112th Congress
R41777: Antipoverty Effects of Unemployment Insurance
RL34340: Extending Unemployment Compensation Benefits During Recessions
R41859: Unemployment Insurance: Consequences of Changes in State Unemployment Compensation Laws
R42643: Receipt of Unemployment Insurance by Higher-Income Unemployed Workers (“Millionaires”)
RS22077: Unemployment Compensation (UC) and the Unemployment Trust Fund (UTF): Funding UC Benefits
RS22954: The Unemployment Trust Fund: State Insolvency and Federal Loans to States
RS22006: The Unemployment Trust Fund and Reed Act Distributions
RS21356: Taxation of Unemployment Benefits
R41253: The Self-Employment Assistance (SEA) Program
R40689: Compensated Work Sharing Arrangements (Short-Time Compensation) as an Alternative to Layoffs
RS22440: Unemployment Compensation (Insurance) and Military Service
This page was prepared on August 29, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Following is a list of tables and figures related to Unemployment Insurance that can be found in the CRS reports included in this Green Book chapter.
RL33362: Unemployment Insurance: Programs and Benefits
Table 1. State Unemployment Compensation Benefits Amounts, January 2014
Table 2. State Unemployment Taxes: Taxable Wage Base and Rates, January 2014
Table 3. Revenue and Expenditures Associated with Unemployment Compensation, FY2001-FY2014
Table B-1. Emergency Unemployment Compensation Program: Public Law, Benefits, Effective Dates, and Financing
Figure A-1. Sequence of Unemployment Benefits: UC, EUC08, and EB Until December 28, 2013
Figure A-2. Benefits Available in Emergency Unemployment Compensation (EUC08) July 6, 2008-December 28, 2013
R42444: Emergency Unemployment Compensation (EUC08): Status of Benefits Prior to Expiration
Table 1. Summary of Emergency Unemployment Compensation (EUC08) Program: Public Law, Benefits, Effective Dates, and Financing
Table 2. Summary of EUC08 Program Authorization Lapses
Figure 1. Benefits Available in Emergency Unemployment Compensation (EUC08), July 6, 2008-December 28, 2013
Figure A-1. Sequence of Unemployment Benefits Prior to EUC08 Expiration
R42936: Unemployment Insurance: Legislative Issues in the 113th Congress
Table 1. Proposals to Extend Emergency Unemployment Compensation (EUC08) and Other Federal Unemployment Insurance (UI) Provisions
Figure 1. Sequence of Unemployment Benefits: UC, EUC08, and EB Until December 28, 2013
R41662: Unemployment Insurance: Legislative Issues in the 112th Congress
Figure 1. P.L. 112-96 Changes to EUC08 Program
R41777: Antipoverty Effects of Unemployment Insurance
Table 1. General Description of Temporary Federal Unemployment Insurance Programs, 1987-2012
Figure 1. Monthly and Annual Average Unemployment Rate
Figure 2. Median Duration of Unemployment among Unemployed Workers in Weeks, January 1987 to August 2012
Figure 3. Seasonally Adjusted Unemployment Rate and an Alternative Measure of Underutilization (BLS U-6 Definition)
Figure 4. Percentage of Unemployed Receiving Unemployment Benefits
Figure 5. Percentage of Unemployed Receiving Temporary (EUC, TEUC, or EUC08) Benefits or Extended Benefits
Figure 6. Pre- and Post-UI Benefit Poverty Rates of Persons, 1987-2011
Figure 7. Number of Persons Lifted Above Poverty as a Result of UI Benefit Receipt, 1987-2011
Figure 8. Pre- and Post-UI Benefit Poverty Rates of Persons in Families that Received UI Benefits, 1987-2011
Figure 9. Percentage Reduction in the Poverty Rate as a Result of UI Benefit Receipt, Overall Poverty Rate and Poverty Rate for Persons in Families that Received UI Benefits, 1987-2011
Figure 10. UI Benefits: Aggregate Dollars and Dollars Reducing Poverty, 1987-2011
Figure 11. Share of Aggregate UI Benefits Going Toward Reducing Poverty, 1987-2011
Figure 12. Pre-Post UI Poverty Rates Among Unemployed Persons Who Received UI Benefits and Those Who Did Not, 1987-2011
Figure 13. Share of Unemployed Persons Who Had No Earnings in the Year, by UI Receipt, 1987-2011
Figure B-1. Persons Who Reported UI Benefit Receipt, by Labor Force Status: 2011
Figure B-2. Persons Who Reported UI Benefit Receipt, by Labor Force Status: 2011
Figure B-3. Share of Unemployed and Underutilized Workers at Any Time During the Year Compared to Monthly and Annual Average Unemployment
Figure B-4. Expanded Definitions of Unemployment and Labor Underutilization, 1987-2011
Figure B-5. An Expanded Definition of Unemployed and Underutilized Workers, 1987-2011
Figure B-6. Unemployment Insurance Receipt Among Persons, by Selected Labor Force Status, 1987-2011
Figure C-1. UI Recipients and Aggregate UI Dollars CPS/ASEC Estimates as a Percent of Administrative Benchmarks 1987-2011
RL34340: Extending Unemployment Compensation Benefits During Recessions
Table A-1. Summary of Extended Unemployment Compensation Programs
Table A-2. Details: Federal Supplemental Compensation (FSC) Benefits
Table A-3. Details: Emergency Unemployment Compensation (EUC) Benefits of 1991
Table A-4. Details: Emergency Unemployment Compensation (EUC08) Benefits of 2008
Table A-5. Timing of Recessions, 12-Month Change of at Least One Million, and Extended Unemployment Benefits, 1990-2013
Table A-6. Funding Temporary Unemployment Programs
Table A-7. Potential Maximum Available Weeks of Unemployment Benefits, 1935-Present
Figure 1. Economic Recessions, Percentage of Regular UC Beneficiaries to All Unemployed, and UC Benefit Exhaustees, January 1979-July 2014
Figure 2. Recessions, Changes in Unemployment Compared with the Same Month in Previous Year, Unemployment Rates, and Temporary Federal Benefit Availability, January 1979-July 2014
Figure 3. Recessions, Changes in Regular UC Benefit Exhaustions Compared with the Same Month in Previous Year, and Unemployment Rates, January 1979-July 2014
Figure 4. Recessions, Changes in Long-Term Unemployment Compared with the Same Month in Previous Year, and Unemployment Rates, January 1979-July 2014
R41859: Unemployment Insurance: Consequences of Changes in State Unemployment Compensation Laws
Table 1. States with Unemployment Compensation (UC) Law Changes That Decrease Benefit Duration
Table 2. Adjusted Maximum EUC08 (when authorized) and EB Benefit Duration Resulting from Changes to State Maximum UC Benefit Duration
R42643: Receipt of Unemployment Insurance by Higher-Income Unemployed Workers (“Millionaires”)
Table 1. Number of Tax Filers Receiving Unemployment Benefit Income
Table 2. Amount of Unemployment Benefit Income Received by Tax Filers
RS22077: Unemployment Compensation (UC) and the Unemployment Trust Fund (UTF): Funding UC Benefits
Figure 1. The Unemployment Trust Fund
RS22954: The Unemployment Trust Fund (UTF): State Insolvency and Federal Loans to States
Table 1. Schedule of State Tax Credit Reduction and Net Federal Unemployment Tax Act (FUTA) Tax
Table 2. Outstanding Loan Balances, Interest Owed, and Potential State Tax Credit Reduction (February 18, 2014)
Table 3. State Unemployment Trust Fund Accounts: Financial Information by State, 3rd Quarter Calendar Year 2013
RS22006: The Unemployment Trust Fund and Reed Act Distributions
Table 1. Reed Act Distributions
RS21356: Taxation of Unemployment Benefits
Table 1. Number of Federal Tax Returns With Reported Unemployment Compensation (UC) and Amount of Benefits, Tax Years 1998-2011
Table 2. Estimated Effect of Taxing Unemployment Compensation, by Income Class, 2005
R41253: The Self-Employment Assistance (SEA) Program
Table 1. States with SEA Programs for UC Claimants
Table 2. Number of Recent Participants in the Self-Employment Assistance (SEA) Program for UC Claimants, by State, 2000-2013
R40689: Compensated Work Sharing Arrangements (Short-Time Compensation) as an Alternative to Layoffs
Table 1. Short-Time Compensation (STC) and Regular Unemployment Insurance (UI) Beneficiaries, 1982 to 2013
Table 2. State Legislation and Short-Time Compensation (STC) First Payments as Percentage of Regular Unemployment Compensation First Payments, 2013
Table 3. State Enactment of Short-Time Compensation (STC) Program
Table A-1. States with Short-Time Compensation Programs
RS22440: Unemployment Compensation (Insurance) and Military Service
Table 1. Unemployment Compensation Benefit Eligibility for Workers Who Voluntarily Quit Because of a Spousal Transfer
This page was prepared on August 29, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
This page was prepared on August 29, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The document provided below, Chronology of Federal Unemployment Compensation Laws, was prepared by the Department of Labor and provides information on the history and chronology of unemployment compensation law since 1935. This version was last updated on July 1, 2014.
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The following sources highlight state and regional unemployment insurance (UI) benefits and programs.
Comparison of State Unemployment Compensation Laws
Regions & States (State and local contacts, state and local resources)
The following sources represent selected federal agency statistics and databases on unemployment insurance program statistics (such as weekly claimants), unemployment trends, and demographic data.
Employment and Training Administration, Department of Labor
Unemployment Insurance, Program Statistics, Links to various program statistics and types of financial information
UI Weekly Claims, Data available for the regular UC program, Extended Benefits program, and the EUC08 program
UI Characteristics of the Insured Unemployed, Demographic data including age, gender, race/ethnicity, and industry
UI Chartbook, Unemployment trend data for the U.S. and each state beginning with data from 1967
Bureau of Labor Statistics, Department of Labor
Employment Situation Summary, BLS monthly report summarizing national statistics including total nonfarm payroll employment, the unemployment rate, demographic data, part-time employment, and selected industry data
Unemployment Rate for States, BLS monthly report from Local Area Unemployment statistics survey
Regional and State Employment and Unemployment Summary, BLS monthly report on state and regional unemployment statisticsß
This page was prepared on August 29, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Retirement, survivor, disability, unemployment, and sickness insurance benefits for railroad employees are administered by the U.S. Railroad Retirement Board (RRB), an independent Federal agency headquartered in Chicago. The term “Railroad Retirement Board” (RRB) refers both to the agency that administers the Federal benefits of industry employees and to the 3-member governing board that oversees the agency.
The programs are governed by the Railroad Retirement Act and the Railroad Unemployment Insurance Act. Railroad retirement came into existence in 1936, and was substantially modified by the Railroad Retirement Act of 1974 (Public Law 93-445) which provided for closer coordination with the Social Security system. In the House of Representatives, jurisdiction over the Railroad Retirement and Unemployment Benefit Programs is divided between two standing committees. The Transportation and Infrastructure Committee has jurisdiction over legislation pertaining to “railroads… and railroad retirement and unemployment (except revenue measures related hereto).” The Subcommittee on Railroads of the committee has primary responsibility for the Railroad Retirement Act (RRA) and amendments affecting railroad retirement. The Committee on Ways and Means has jurisdiction over all revenue measures, including the Railroad Retirement Tax Act (chapter 22 of the Internal Revenue Code). Within the Committee on Ways and Means, jurisdiction over employment taxes and trust fund operations relating to the Railroad Retirement System lies within the Subcommittee on Social Security.
Railroad retirement and survivor benefits are financed by: (1) payroll taxes paid by covered employees and employers on railroad earnings, up to a certain maximum wage base; (2) income from the financial interchange with the Social Security trust funds; (3) appropriations from general revenues (including transfers of income taxes collected on benefits); and (4) investment income. The primary source of income to the Railroad Retirement Account is payroll taxes levied on covered employers and their employees. These taxes are imposed on wages below an annual maximum amount known as the “wage base.” The tier 1 tax is equivalent to the Social Security payroll tax, that is, both employers and employees generally pay a 6.2% tier 1 tax up to an earnings threshold ($117,000in 2014). In December 2010, Congress approved a temporary 2 percentage point reduction in the tier 1 payroll tax rate for railroad employees along with a transfer of general revenues to the railroad retirement system to make up for the loss of payroll tax revenues; these provisions were extended through December 2012. Since 1994, the hospital insurance (Medicare Part A) portion of the tier 1 tax, equal to 1.45 percent on employers and employees, has applied to all earnings. In addition, a tier 2 tax is paid by both rail employers and employees. In 2014, the tier 2 tax is 12.6% for employers and 4.4% for employees on earnings up to $87,000. The Railroad Retirement and Survivors’ Improvement Act of 2001 (Public Law 107-90) made significant changes to the way the Railroad Retirement System is financed. The 2001 law provided for investment of railroad retirement funds in nongovernmental assets (as well as government securities), periodic adjustments in tier 2 payroll tax rates paid by employers and employees, and repeal of the supplemental annuity work-hour tax paid by employers.
Employees are eligible for a tier 1 retirement annuity if they have at least 10 years of total railroad service, or at least 5 years of railroad service after 1995 and “insured status” under the Social Security rules (generally 40 quarters of coverage) based on combined railroad retirement and Social Security-covered earnings. The tier 1 benefit is roughly equal to what the Social Security benefit would have been had the worker's railroad employment been covered by the Social Security program; the principal difference is that railroad workers with 30 years of service are eligible to receive full tier 1 benefits at age 60. Tier 2 benefits, which are payable in addition to tier 1 benefits, are based entirely on the employee's service in the railroad industry. For current retirees, the tier 2 benefit is equal to seven-tenths of 1 percent of the employee's average monthly earnings in the 60 months of highest earnings, times the total number of years of railroad service. Annuities may be payable under both tiers to spouses, surviving spouses, children, and certain other beneficiaries. Supplemental annuities are payable to employees age 65 or older with 25 or more years of railroad service who have a current connection with the railroad industry, and some service prior to October 1981, and whose regular annuities were awarded after June 30, 1966. (An employee generally has a current connection if he or she has 12 months of railroad service in the 30 months preceding retirement or death, or if the employee did not perform any regular employment between the end of the 30-month period containing the last 12 months of railroad service and the month of retirement or death.) Employees retiring after June 1974 with 30 or more years of service are eligible to receive supplemental annuities as early as age 60.
Workers who are totally and permanently disabled for all employment are eligible for tier 1 and tier 2 benefits if they have at least 10 years of total railroad service. Workers who have at least 5 years of railroad service after 1995 (but less than 10 years of total service) are eligible only for tier 1 benefits before age 62 if their combined railroad retirement and Social Security earnings credits satisfy Social Security eligibility requirements (tier 2 benefits would be payable at age 62). Otherwise, workers with employment covered under Social Security would have their railroad retirement credits transferred to Social Security and eligibility for Social Security disability insurance would be determined under Social Security rules. In addition, workers who become totally disabled for their regular railroad occupation are eligible for an occupational disability benefit at age 60 with at least 10 years of railroad service, and at any age with at least 20 years of railroad service. To qualify, the worker must have a current connection with the industry, which generally means that he or she worked for a railroad in at least 12 of the 30 consecutive months before the month in which an annuity begins to accrue.
The Railroad Retirement System and the Social Security program have been coordinated financially since 1951. The purpose of the financial interchange is to place the Social Security Trust Funds in the same position in which they would have been if railroad employment had been covered under Social Security since its inception. Doing so involves computing the amount of Social Security payroll and income taxes that would have been collected by the Social Security Trust Funds if railroad employment had been covered directly by Social Security, as well as the amount of additional benefits which Social Security would have paid to railroad retirement beneficiaries during the same fiscal year. In the computation of the latter amount, credit is given for any Social Security benefits actually paid to railroad retirement beneficiaries. When benefit reimbursements exceed payroll and income taxes, the difference, with an allowance for interest and administrative expenses, is transferred from the Social Security Trust Funds to the RRB’s Social Security Equivalent Benefit Account. (Before 1985, transfers were made to the Railroad Retirement Account.) If taxes exceed benefit reimbursements (which has not happened since 1951), a transfer would be made in favor of the Social Security Trust Funds. The financial interchange with Social Security provided 34.4% of RRA funding in FY2013. The determination of the amount to be transferred through the financial interchange for a given fiscal year is made no later than June of the year following the close of the preceding fiscal year.
The Railroad Unemployment Insurance Act (Public Law 75-722) was passed in 1938 to provide a uniform unemployment insurance system for all railroad workers, regardless of the State in which they worked or lived. The main reasons for this action were to avoid administrative problems in handling claims for railroad workers who earned wages in a number of States and to accommodate the railroad unions' desire that individuals throughout the industry be treated the same for purposes of unemployment compensation.
A new benefit year for unemployment and sickness benefits begins on July 1 of each year. To qualify in the benefit year beginning July 1, 2014, an employee must have had railroad earnings of at least $3,512.50 in calendar year 2013, not counting earnings over $1,405 in any month. If the base year was the first year of railroad service, the worker also must have worked in at least 5 months of that year. No benefits are payable for the first 7 days of the first claim (or claims) for unemployment and sickness in a benefit year. This generally results in a 1-week waiting period. A claimant is normally paid for benefits if he or she is unemployed or sick for more than 4 days in a 14-day period. The maximum daily benefit payable in the benefit year that began July 1, 2014 is $70, and maximum benefits for biweekly claims is $700. However, due to sequestration pursuant to the Budget Control Act of 2011, the maximum biweekly benefit is reduced by 7.2% to $649.60 through September 30, 2014. The program offers “normal” and “extended” benefits. Qualified workers can receive normal benefits for up to 130 days (26 weeks), but the total may not exceed their creditable wages in the base year. Workers with at least 10 years of railroad service may receive up to 65 additional days (13 additional weeks) of extended benefits. During 2009-2013, Congress provided up to 13 additional weeks of extended benefits to unemployed railroad workers, regardless of years of railroad service.
Sickness benefits, established in 1946, are paid during short-term illnesses or injuries of railroad employees. They are financed out of the same employer-paid payroll taxes used to finance unemployment compensation benefits.
The Railroad Unemployment and Sickness Benefit Programs are financed by payroll taxes on railroad employers. The earnings base is adjusted each year to equal approximately two-thirds of the cumulative increase in the maximum base for railroad retirement tier 1 taxes since 1984. Experience-based tax rates, under which employers who generate higher numbers of claimants of unemployment benefits pay somewhat higher rates, were phased in on a partial basis in 1991 and 1992, and became fully effective in 1993 with a minimum rate of 0.65 percent and a maximum rate of 12 percent. The future maximum rate could be 12.5 percent if a maximum surcharge is in effect. The Railroad Unemployment Insurance and Railroad Unemployment Insurance Administration Accounts are part of the Federal Unemployment Trust Fund. Since 1959, the Railroad Unemployment Trust Fund has been able to borrow funds from the railroad pension fund when employer taxes have not been sufficient to cover the costs of unemployment and sickness benefits. The RRB is required to submit an annual financial report to Congress on the status of the Unemployment Insurance System.
This chapter of the Green Book includes two Congressional Research Service (CRS) Reports. A separate section identifies Tables and Figures included in the CRS reports and also provides additional tables and figures related to Earned Entitlements for Railroad Employees. Additional sections include a Legislative History and Links to Additional Resources.
This page was prepared on September 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation.
RS22782: Railroad Retirement Board: Trust Fund Investment Practices
This page was prepared on September 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures can be found in the CRS reports included in this chapter of the Green Book.
Table 1. Railroad Retirement, Survivor, and Disability Benefits
RS22782: Railroad Retirement Board: Trust Fund Investment Practices
Table 1. Trust Target Asset Allocations and Ranges
Table 2. Trust Expense Ratios
Figure 1. Trust Rates of Return Compared with Strategic Policy Benchmarks
This page was prepared on September 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Table 5-2. Number and Average Amount of New Awards, May 2014
Table 5-3. Scheduled Tier I and Tier 2 Tax Rates, Selected Years 1974-2014
Table 5-5. Covered Employees in the Railroad Industry
Table 5-6. Railroad Unemployment and Sickness Insurance Program Statistics
Table 5-7. Benefits under the Railroad Unemployment Insurance System, 2011-2014
This page was prepared on September 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following provides a legislative history of benefits for railroad workers from the 112th Congress through the first session of the 113th Congress. For prior legislative history, please see the 2012 Green Book.
In the 112th Congress, the Middle Class Tax Relief and Job Creation Act of 2012 (Public Law 112-96) and then the American Taxpayer Relief Act of 2012 (Public Law 112-240) authorized extended unemployment benefits, which were first created in 2008, through the end of 2013. No special extended unemployment benefit periods were authorized to begin after December 31, 2013.
This page was prepared on September 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Railroad Retirement Board, www.rrb.gov
Whitman, Kevin, An Overview of the Railroad Retirement Program, Social Security Bulletin, Vol. 68 No. 2, 2008.
This page was prepared on September 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Trade Adjustment Assistance (TAA) is a group of programs that target federal assistance to workers, firms, farmers, and communities that have been adversely affected by foreign trade. TAA was created by the Trade Expansion Act of 1962 (P.L. 87-794) and has been reauthorized and expanded several times in subsequent years, most prominently as part of the Trade Act of 1974 (P.L. 93-618), the Trade Act of 2002 (P.L. 107-210), the Trade and Globalization Adjustment Assistance Act of 2009, and the Act to extend the Generalized System of Preferences, and for other purposes (including Title II, the Trade Adjustment Assistance Extension Act of 2011) (P.L. 112-40).
The largest TAA program, TAA for Workers (TAAW) provides federal assistance to workers who have been separated from their jobs because of increased imports or because their jobs moved to a foreign country. The largest components of the TAAW program are (1) training funds to prepare workers for a new occupation and (2) income support for workers who are enrolled in an eligible training program and have exhausted their unemployment compensation. The TAAW program is administered by the Department of Labor (DOL). DOL also administers the Trade Adjustment Assistance Community College and Career Training (TAACCCT) grant program. This program provides competitive grants to institutions of higher education to develop, improve, or offer training programs that can be completed in two years or less and are appropriate for workers who are eligible for the TAAW program.
TAA programs are also available to firms and farmers that have been adversely affected by international competition. TAA for Firms, administered by the Department of Commerce, supports trade-impacted businesses by providing technical assistance in developing business recovery plans and by providing matching funds to implement those plans. TAA for Farmers, administered by the Department of Agriculture, provides technical support and cash benefits to producers of agricultural commodities and fisherman who are adversely affected by increased imports.
All TAA programs are authorized by the Trade Act of 1974, as amended. The programs for workers, firms, and farmers were most recently reauthorized by the Trade Adjustment Assistance Extension Act of 2011 (Title II of P.L. 112-40). The authorizations of appropriations for these three programs are scheduled to expire December 31, 2014. The TAACCCT program was funded with four years of advance appropriations, beginning in FY2011. FY2014 is the final year of scheduled funding for TAACCCT grants.
An annual report, required by statute, is due to Congress for each of the TAA programs. Although due to Congress no later than February 15, 2014, DOL provided its TAAW FY2013 Annual Report to Congress on October 3, 2014. Because this report was not provided to Congress in a timely manner, this chapter of the Green Book only contains data for TAAW through FY2012. Furthermore, DOL has not met its statutory deadline for providing its required annual report for the TAACCCT program, due to Congress no later than December 15, 2013. Therefore, this chapter of the Green Book only contains data for this program through FY2012.
This chapter of the Green Book includes a series of Congressional Research Service (CRS) Reports, one of which provides a legislative history of TAA and the others discuss TAA programs. A subsequent section lists all Tables and Figures contained in these CRS reports, and includes Additional Tables and Figures related to TAA. The chapter also includes Links to Additional Resources.
This page was prepared on August 14, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation.
R41922: Trade Adjustment Assistance and Its Role in U.S. Trade Policy
R42012: Trade Adjustment Assistance for Workers
R42661: Trade Adjustment Assistance Community College and Career Training Grants
RS20210: Trade Adjustment Assistance for Firms: Economic, Program, and Policy Issues
R40206: Trade Adjustment Assistance for Farmers
This page was prepared on August 6, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures related to TAA can be found in the CRS reports section of this Green Book chapter.
R41922: Trade Adjustment Assistance (TAA) and Its Role in U.S. Trade Policy
Appendix. TAA Reauthorization, 1962-2011
R42012: Trade Adjustment Assistance for Workers
Table 1. TAA Group Certification Requirements in Effect During Different Time Periods Under the Provisions Adopted in the Trade Adjustment Assistance Extension Act of 2011
Table 2. TAA Benefits in Effect During Different Time Periods Under the Provisions Adopted in the Trade Adjustment Assistance Extension Act of 2011
Table 3. Applicable Periods of Trade Adjustment Assistance Legislation
Table 4. Petitions and Certifications, FY2003-FY2012
Table 5. Trade Adjustment Assistance Participation, FY2003-FY2014
Table 6. Employment Outcomes for TAA Exiters, FY2009-FY2012
R42661: Trade Adjustment Assistance Community College and Career Training Grants
Table 1. Authorization Levels and Appropriations for the Community College and Career Training Grants Program: FY2009-2014
RS20210: Trade Adjustment Assistance for Firms: Economic, Program, and Policy Issues
Table 1. Firm TAA Authorizations and Appropriations, FY2001-FY2014
Table 2. Characteristics of Technical Assistance in APs: FY2013
Table 3. Trade Adjustment Assistance for Firms, Select Program Indicators for FY2004-FY2013
Figure 1. Three Stages of TAAF: Process and Interaction among Firms, TAACs, and EDA
R40206: Trade Adjustment Assistance for Farmers
Table 1. TAAF Funding, and Spending by Type of Activity, FY2003-FY2014
Table 2. Activity Under Trade Adjustment Assistance for Farmers Program, FY2003-FY2014
Table 3. Certified TAAF Petitions, FY2004-FY2011This page was prepared on August 14, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
This page was prepared on August 6, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
This page was prepared on September 30, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
For the legislative history of the Trade Adjustment Assistance program, please see:
R41922: Trade Adjustment Assistance (TAA) and Its Role in U.S. Trade Policy
This page was prepared on August 14, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
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TAA for Workers FY 2012 Annual Report
TAA for Firms FY 2013 Annual Report
TAA for Firms FY 2012 Annual Report
TAA for Farmers FY 2011 Annual Report
TAA Community College and Career Training Grants FY 2012 Annual Report
DOL has not met its statutory deadline for providing its required annual report for the TAACCCT program, due to Congress no later than December 15, 2013. Funding for TAAF expired in 2010, making FY 2011 the last statutorily required report.
This page was prepared on October 4, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The Temporary Assistance for Needy Families (TANF) block grant provides grants to states, Indian tribes, and territories for a wide range of benefits, services, and activities that address economic disadvantage. TANF is best known for funding state cash welfare programs for low-income families with children. It was created in the 1996 welfare reform law (The Personal Responsibility and Work Opportunity Reconciliation Act of 1996, P.L. 104-193), replacing the Aid to Families with Dependent Children (AFDC) cash welfare program and several related programs. However, in FY2013, states reported that cash welfare represented only 28% of state and federal spending in the TANF program. TANF funds a wide range of activities that seek to both ameliorate the effects and address the root causes of child poverty. In addition to state block grants, TANF includes competitive grants to fund healthy marriage and responsible fatherhood initiatives.
Federal TANF law is Title IV-A of the Social Security Act. At the federal level, TANF is administered by the Department of Health and Human Services (HHS). However, benefits and services are provided by the states, territories, and tribes, which have broad flexibility in how to administer their programs. TANF programs operate in all 50 states, the District of Columbia, Puerto Rico, Guam, and the Virgin Islands. American Samoa is eligible to operate a TANF program, but has not opted to do so.
This chapter of the Green Book includes Congressional Research Service (CRS) Reports detailing:
Tables and Figures included in those CRS reports are identified in a following section. In addition, a section of Additional Tables and Figures includes tables on TANF expenditures and unspent grant funds. The chapter concludes with a Legislative History of TANF and Links to Additional Resources, which include a set of links to Department of Health and Human Services (HHS) web sites and research organizations for additional information about TANF.
This page was prepared September 15, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation.
R42767: Temporary Assistance for Needy Families (TANF): Welfare-to-Work Revisited
This page was prepared on September 3, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures related to Temporary Assistance for Needy Families (TANF) can be found in the CRS reports included in this Green Book chapter.
Table 1. Federal TANF Funds: FY2006-FY2014
Table 2. TANF Basic Block Grant to the States
Table 3. Federal TANF and State MOE Funding Levels
Table 4. Summary of Rules for the Use of Federal TANF and State MOE Funds
Table 5. Summary of TANF Requirements that Apply to Recipients of Assistance, by Funding Source of the Benefit
Table 6. Countable TANF Work Activities and Their Definitions
Table 1. State TANF Cash Assistance Program Vehicles Disregards from Asset Limits for New Applicant Families, July 2012
Table A-1. Maximum Monthly Earnings an Applicant Family Comprising a Single Parent Caring for Two Children May Have to Gain Eligibility for TANF Cash Assistance: July 2012
Table A-2. Maximum Monthly Earnings a Single Parent Caring for Two Children May Have for Applicants or for Recipients to Retain Eligibility for TANF Cash Assistance, July 2012
Table A-3. Maximum Monthly TANF Cash Assistance Benefit for a Single Parent Caring for Two Children, July 2012
Table A-4. Maximum Monthly TANF Cash Assistance Benefits Paid to a Family Headed by a Single Parent, By Family Size, July 2012
Table A-5. Maximum Combined TANF and SNAP Benefit for a Single Parent Caring for Two Children, July 2012
Table A-6. Maximum Monthly AFDC/TANF Cash Assistance Benefits for a Single Parent Caring for Two Children, July of Selected Years
Table A-7. Maximum Monthly AFDC/TANF Cash Assistance Benefit for a Single Parent Caring for Two Children in Constant July 2012 Dollars
Table A-8. Maximum Monthly AFDC/TANF Cash Assistance Benefit for a Single Parent Caring for Two Children, as a Percent of the Federal Poverty Level, July of Selected Years
Figure 1. Maximum Monthly Earnings An Applicant Family May Have and Be Eligible for TANF Cash Assistance: Single Parent Caring for Two Children: July 2012
Figure 2. State TANF Cash Assistance Program Asset Limits for New Applicant Single Parents Caring for Two Children, July 2012
Figure 3. TANF Maximum Monthly Benefits for a Single Parent Caring for Two Children, by State, July 2012
Figure 4. Combined TANF Cash Assistance and SNAP Benefit, Single Parent Caring for Two Children: July 2012
Figure 5. AFDC/TANF Maximum Benefits for a Family of Three in the Median State, July of Selected Years 1981-2012
Figure 6. Combined Cash Assistance and Food Assistance for a Family of Three: July 1981, July 1996, and July 2012
Table 1. Summary Characteristics of AFDC/TANF Cash Assistance Families: Selected Years FY1988 to FY2011
Table 2. Families Receiving TANF Cash Assistance by Family Category and Number of Child Recipients: FY2011
Table 3. Families Receiving TANF Cash Assistance by Family Category and Age of Youngest Child: FY2011
Table 4. TANF Child Recipients: by Family Category and Race/Ethnicity: FY2011
Table A-1. Families Receiving Cash Assistance by Family Category: Selected Years, FY1988 to FY2011
Table A-2. TANF Cash Assistance Caseload By Family Category and State: FY2011
Table A-3. Ratio of TANF Child Recipients to All Children and Poor Children by Race/Ethnicity, Selected Years
Figure 1. Number of Families Receiving AFDC/TANF Cash Assistance: 1959-2013
Figure 2. Families Receiving AFDC/TANF Cash Assistance, By Category, Selected Years FY1988 to FY2011
R42767: Temporary Assistance for Needy Families (TANF): Welfare-to-Work Revisited
Table 1. Summary Characteristics of Work-Eligible Individuals: FY2011
Table 2. TANF Work-Eligible Individuals Employed or Participating in a Work or Job Preparation Activity: by Characteristic, FY2011
Table 3. Percentage of Cash Assistance Adults and Teen Parents Employed or Engaged in a Work or Job Preparation Activity, FY2011
Table 4. TANF Families Sanctioned for Work, Educational, or Activity Requirements: FY2001-FY2011
Table 5. TANF Assistance Families Included and Not Included in the TANF Work Participation Rate, FY2011
Table 6. Countable TANF Work Activities and Their Definitions
Table 7. TANF Hours Requirements for the All-Family Rate and the Two-Parent Family Rate (Excludes Special Rule for Teen Parents), by Family Type
Table 8. TANF Work Participation Among Teen Parents Included in the Participation Rate Without a High School Diploma, by Age, FY2011
Table 9. TANF “Core” and “Supplemental” Work Activities
Table 10. Effective TANF Work Participation Standards for All Families: FY2002‑FY2011
Table 11. Employment Status of Young Adults (Aged 20 to 24), Selected Years 1994‑2011
Table 12. Enrollment in Educational Programs of Young Adults (Aged 20 to 24), Selected Years 1994-2010
Table A-1. Effective TANF Work Participation Standards for All Families by State: FY2002-FY2011
Table A-2. TANF Work Participation Rates by State: Official Rates (Including Grandfathered Waivers), FY2002-FY2011
Table A-3. TANF Work Participation Rates for All Families Excluding the Effects of Grandfathered Waivers by State: FY2002‑FY2011
Table A-4. TANF Effective Work Participation Standards and Work Participation Rates: FY2011
Table A-5. TANF Families Receiving Assistance, by Type of Family and State: FY2011
Table A-6. TANF Families Receiving Assistance, by Work Participation Rate Status and State: FY2011
Table A-7. TANF Families Included in the Work Participation Rate, by Family Type and State, FY2011
Table A-8. TANF Sanctions and Sanction Rates by State: FY2011
Figure 1. TANF Assistance Families, by Family Type, FY2011
Figure 2. Work Participation of TANF Work-Eligible Individuals: FY2011
Figure 3. TANF Effective (After-Credit) Work Participation Standards for FY2011
Figure 4. TANF Assistance Families Included and Not Included in the Work Participation Rate: FY2011
Figure 5. Percentage of TANF Work-Eligible Individuals Included in the Participation Rate in TANF Work Activities: FY2011
Figure 6. TANF Families Included in the Work Participation Rate, by Family Type, FY2011
Figure 7. Distribution of TANF Single Parent Families Included in the TANF Work Participation Rate by Hours of Participation in Activities and by Presence of a Child Under Age 6 in the Family, FY2011
Figure 8. Distribution of TANF Two-Parent Families Included in the TANF Work Participation Rate by Hours of Participation in Activities, FY2011
Figure 9. Percentage of TANF Work-Eligible Individuals Included in the Work Participation Rate Who Participated in Work- and Education-Related Activities, FY2011
Figure 10. TANF Effective Work Participation Standards and Work Participation Rates, by State, FY2011
Figure 11. National Average TANF Work Participation Rate for All Families, FY2002‑FY2011
This page was prepared on September 3, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following figure and tables provide information on how states have used their TANF funds. They provide information for or (in the case of historical tables) through Fiscal Year 2013.
Figure 7-1. Federal TANF and State MOE Funds Used in FY2013 by Major Benefit and Service Category
Table 7-1. Value of the State Family Assistance Grant: FY1997-FY2013
Table 7-4. Federal TANF and MOE Child Care Expenditures and Transfers: FY1997-FY2013
Table 7-5. Use of FY2013 TANF and MOE Funds by Category and State
Table 7-7. Unspent TANF Grants: End of FY1997 Through End of FY2013
Table 7-8. Unspent TANF Funds at the End of FY2013 by State
The following figure and tables provide information on the cash assistance caseload under TANF and its predecessor program, Aid to Families with Dependent Children (AFDC).
Figure 7-2. Number of Families Receiving Cash Assistance: 1959-2013
Table 7-9. Trends in the Cash Assistance Caseload: 1961-2013
Table 7-10. TANF Cash Assistance Families by Type: 2000-2013
This page was prepared on September 3, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following provides a legislative history of Temporary Assistance for Needy Families (TANF) during the 113th Congress. For prior legislative history, please see the 2012 Green Book.
P.L. 113-6, Consolidated and Further Continuing Appropriations Act, 2013, extended TANF funding through September 30, 2013. Signed into law March 26, 2013.
P.L. 113-46, Continuing Appropriations Act, 2014, extended TANF funding through January 15, 2014. Signed into law October 17, 2013. [Note: The authorization for the TANF program expired on October 1, 2013 as part of the partial Federal government “shutdown,” and was reauthorized by P.L. 113-46 on October 17, 2013]
P.L. 113-73, Making further continuing appropriations for fiscal year 2014, extended TANF funding through January 18, 2014. Signed into law January 15, 2014.
P.L. 113-76, Consolidated Appropriations Act, 2014, extended TANF funding through September 30, 2014. Signed into law January 17, 2014.
This page was prepared on September 2, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Federal TANF Law (Note: Title IV-A, Sections 401-419 comprise TANF).
Office of Family Assistance (OFA) of the Administration for Children and Families. The office administers TANF, and its site includes policy documents and program data.
Office of Planning, Research, and Evaluation (OPRE) of the Administration for Children and Families. This office funds research related to programs administered within the Administration for Children and Families. It has a site devoted to research on welfare and self-sufficiency issues.
Office of the Assistant Secretary for Planning and Evaluation (ASPE). This office also funds research projects and maintains a web page on TANF issues.
The Self-Sufficiency Research Clearinghouse (SSRC). This website, funded by the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Planning, Research, and Evaluation, is designed to collect, catalogue and disseminate quality research and resources relevant to researchers and professionals invested in the self-sufficiency of low-income families and individuals.
MDRC has a long history of evaluating social programs, particularly welfare-to-work initiatives.
Mathematica Policy Research also has a long history of program evaluations, including welfare-to-work programs.
The Urban Institute produces studies on the low-income population, including those receiving cash assistance. It is also the home of the Welfare Rules Database.
This page was prepared on August 21, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The federal Child Support Enforcement (CSE) program was signed into law in 1975 by President Gerald Ford. It was part of the Social Services Amendments of 1974 (P.L. 93-647). The CSE program is Title IV-D of the Social Security Act. The CSE program is based on the premise that both parents are financially responsible for their children. Child support is the cash payment that noncustodial parents are legally obligated to pay for the financial support of their children. It generally is established when parents divorce or separate or when the custodial parent applies for welfare. It is usually paid on a monthly basis.
When the CSE program was first established, its goals were to reimburse the states and the federal government for the welfare payments it provided families and to help other families obtain consistent and ongoing child support payments from the noncustodial parent so that they could remain self-sufficient and stay off welfare. Congress through legislative changes has broadened the mission of the CSE program. The CSE program has evolved over time from a “welfare cost-recovery” program into a “family-first” service delivery program that seeks to enhance the well-being of families by making child support a reliable source of income. The mission of the CSE program is to enhance the well-being of children by helping custodial parents and children obtain financial support from the noncustodial parents on a consistent and continuing basis. Child support payments enable parents who do not live with their children to fulfill their financial responsibility to their children by contributing to the payment of childrearing costs.
The CSE program provides seven basic services on behalf of children. It (1) locates noncustodial parents, (2) establishes paternity, (3) establishes child support orders, (4) reviews and modifies child support orders, (5) collects child support payments from noncustodial parents, (6) establishes and enforces medical child support, and (7) distributes child support payments to custodial parents.
The CSE program is administered at the federal level by the Office of Child Support Enforcement (OCSE) in the Department of Health and Human Services (HHS). The CSE program is available in all 50 states, the District of Columbia, the territories of Guam, Puerto Rico, and the Virgin Islands, and about 61 tribal nations. The CSE program is usually operated at the county-level of government.
The CSE program is a federal-state program that provides services to both welfare and non-welfare families. Welfare families (i.e., Temporary Assistance for Needy Families (TANF, Title IV-A) recipients, federal foster care families (Title IV-E), and Medicaid recipients (Title XIX)) are automatically enrolled in the program, free of charge. Non-welfare families must sign-up for CSE services and pay an application fee. Also non-welfare families pay a $25 annual user fee if at least $500 per year is collected on behalf of the custodial parent.
There are four primary funding streams for the CSE program. (1) States spend their own money to operate a CSE program. (2) The federal government reimburses each state 66% of all expenditures on CSE activities. (3) States collect child support made on behalf of TANF and foster care families to reimburse themselves and the federal government for the cost of TANF and child welfare payments and/or services to the families. (4) The federal government provides states with an incentive payment to encourage them to operate effective CSE programs. In addition, application and user fees and costs recovered from non-welfare families may help finance the CSE program.
In FY2013, about 12% of the CSE caseload consisted of TANF families; about 43% were families who had at some point been on the TANF program, and 45% were families that had never received TANF benefits. In FY2013, the CSE program collected $28.0 billion in child support payments from noncustodial parents and served 15.6 million child support cases. Of the $28.0 billion collected in child support payments, about 93% went to families, 5% went to state and federal governments, and 2% consisted of medical support payments or fees paid to states. On average, in FY2013 the CSE program collected $5.31 in child support payments for each $1 spent on the program. In FY2013, total CSE expenditures amounted to $5.6 billion.
Not all child support goes through the CSE program. The CSE program handles between 50-60% of all child support cases; the rest are handled by private attorneys or collection agencies, or through mutual agreements between parents.
This chapter of the Green Book includes a series of Congressional Research Service (CRS) Reports organized under the following general headings. Readers should consult the reports listed under each of these headings for information and data related to these topics.
Separate sections provide a list of Tables and Figures in CRS Reports and free-standing Additional Tables and Figures related to the CSE program. Final sections include a Legislative History and Links to Additional Resources.
This page was prepared on July 15, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. Certain CRS reports with cover dates earlier than 2014 are included here because their content remains relevant.
RS22380: Child Support Enforcement: Program Basics
R41204: Child Support Enforcement: Tribal Programs
R43020: Medical Child Support: Background and Current Policy
RS22499: Child Support: An Overview of Census Bureau Data on Recipients
RL33422: Analysis of Federal-State Financing of the Child Support Enforcement Program
RS22753: Child Support Enforcement: $25 User Fee
RL34203: Child Support Enforcement Incentive Payments: Background and Policy Issues
RL34105: The Financial Impact of Child Support on TANF Families: Simulation for Selected States
RS22889: The National Directory of New Hires
R41762: Child Support Enforcement and Driver’s License Suspension Policies
RL31025: Fatherhood Initiatives: Connecting Fathers to Their Children
R41431: Child Well-Being and Noncustodial Fathers
R40499: Child Support and Ex-Offenders
This page was prepared on November 7, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Following is a list of tables and figures related to Child Support Enforcement that can be found in the CRS reports included in this Green Book chapter.
RS22380: Child Support Enforcement: Program Basics
Table 1. Child Support Data—FY2013 (Preliminary)
R41204: Child Support Enforcement: Tribal Programs
Table 1. Tribal CSE Program Financial and Statistical Data, FY2004-FY2010
Table 2. Tribal CSE Program, Expenditures and Collections Per Case, FY2004-FY2010
Table 3. Tribal CSE Summary Data by Tribe, FY2010
Table A-1. Tribal CSE Collections by Tribe, in Rank Order, FY2010
Table A-2. Tribal CSE Expenditures by Tribe, in Rank Order, FY2010
Table A-3. Tribal CSE Caseload by Tribe, in Rank Order, FY2010
Table A-4. Tribal CSE Program: Paternities Established by Tribe, in Rank Order, FY2010
Table A-5. Tribal CSE Program: Child Support Orders Established by Tribe, in Rank Order, FY2010
Table A-6. Tribal CSE Program: Collections Per Dollar of Expenditures by Tribe, in Rank Order, FY2010
Table B-1. Comprehensive Tribal Child Support Enforcement Programs, September 2010
Table B-2. Start-Up Tribal Child Support Enforcement Programs, FY2010
Table C-1. Population Figures for Tribes with Tribal CSE Programs: Tribal Enrollment (2005), BIA Service Population (2005), and Census AIAN Populations in Census- Defined Federal AIAN Areas (2010)
Figure 1. Map of Tribal CSE Programs
Figure 2. Tribal CSE Program: Collections and Expenditures, FY2004-FY2010
R43020: Medical Child Support: Background and Current Policy
Table B-1. Percent of Child Support Cases with Orders in Which Medical Support is Ordered, Versus Ordered and Provided: FY2009, FY2010, and FY2011
Table B-2. Percent of Child Support Cases With a Health Insurance Order Where Health Insurance Was Provided as Ordered: FY2001 and FY2011
RS22499: Child Support: An Overview of Census Bureau Data on Recipients
Table 1. Child Support Award and Receipt, 1993-2011
Table 2. Demographic Characteristics of Custodial Parents by Child Support Award and Receipt Status, 2011
Table A-1. State Criminal Sanctions for Failure to Pay Child Support
RL33422: Analysis of Federal-State Financing of the Child Support Enforcement Program
Table 1. Welfare and Nonwelfare Collections, FY1979-2010
Table 2. Federal, State, and Taxpayer “Savings” or “Costs” from Income and Expenditures Generated by the Child Support Enforcement (CSE) Program, FY1979-FY2009
Table 3. Federal, State, and Taxpayer “Savings” or “Costs” from Income and Expenditures Generated by the Child Support Enforcement (CSE) Program, FY1979-FY2009
Table A-1. Financing of the Federal-State Child Support Enforcement Program, FY1999
Table A-2. Financing of the Federal-State Child Support Enforcement Program, FY2009
Table A-3. Trend in Total CSE Collections, by State, FY1999-FY2010
Table A-4. Trend in TANF/Foster Care Collections, by State, FY1999-FY2009
Table A-5. Trend in Non-TANF Collections, by State, FY1999-FY2009
Table A-6. Average Monthly Child Support Payments in Cases with Collections, by State, FY1999-FY2009
Table A-7. Collections on Behalf of TANF Families as a Percentage of Total CSE Collections, by State, FY1999-FY2009
Table A-8. Trend in Total CSE Expenditures, by State, FY1999-FY2010
Figure 1. Composition of Child Support Caseload, FY2010
Figure 2. Percentages of Total Child Support Collections Distributed to Families, and the Federal and State Governments, FY2010
Figure 3. Welfare and Nonwelfare Collections, FY1979-FY2010
Figure 4. Federal and State “Savings” and/or “Costs” from Income and Expenditures Generated by the Child Support Enforcement Program, FY1979-FY2009
Figure 5. Cash Welfare (AFDC/TANF) Payments and Child Support Collections Made on Behalf of AFDC/TANF Families, FY1994-FY2010
RS22753: Child Support Enforcement: $25 User Fee
Table 1. Method By Which $25 CSE Annual User Fee Is Imposed
RL34203: Child Support Enforcement Program Incentive Payments: Background and Policy Issues
Table 1. Child Support Enforcement Performance Incentive Scores: National Averages (Selected Years)
Table B-1. Actual Incentive Payments, by State, FY2002, FY2005, FY2010, and FY2011
Table B-2. Unaudited Child Support Enforcement Incentive Performance Scores, FY2002
Table B-3. Unaudited Child Support Enforcement Incentive Performance Scores, FY2005
Table B-4. Unaudited Child Support Enforcement Incentive Performance Scores, FY2010
Table B-5. Unaudited Child Support Enforcement Incentive Performance Scores, FY2011
Figure 1. Paternity Establishment Scores: Maximum, Median, Minimum (Selected Years)
Figure 2. Child Support Order Establishment Scores: Maximum, Median, Minimum (Selected Years)
Figure 3. Child Support Current Collections Scores: Maximum, Median, Minimum (Selected Years)
Figure 4. Child Support Arrearage Cases Scores: Maximum, Median, Minimum (Selected Years)
Figure 5. Cost-Effectiveness Scores: Maximum, Median, Minimum (Selected Years)
RL34105: The Financial Impact of Child Support on TANF Families: Simulation for Selected States
Table 1. Treatment of Monthly Child Support Income by the TANF Program, April 2007
Table 2. Monthly TANF and Child Support Income of a Mother with No Earnings and Two Children, Pre- and Post-DRA Policies
Table 3. Monthly TANF and Child Support Income of a Mother with No Earnings and Two Children, With $300 in Child Support
Table 4. Monthly TANF and Child Support Income of a Mother with Half-Time Earnings and Two Children, With $300 in Child Support
Table 5. Monthly TANF and Child Support Income of a Mother with Full-Time Earnings and Two Children, With $300 in Child Support
Table 6. Source of Payment for Increase in Monthly Family Income Resulting From DRA Policy, for a Mother with Two Children, With $300 in Child Support
Table A-1. Impact of DRA Policy on Total Monthly Income for a Single Mother With Two Children in California
Table A-2. Impact of DRA Policy on Total Monthly Income for a Single Mother With Two Children in Illinois
Table A-3. Impact of DRA Policy on Total Monthly Income for a Single Mother With Two Children in Maine
Table A-4. Impact of DRA Policy on Total Monthly Income for a Single Mother With Two Children in Maryland
Table A-5. Impact of DRA Policy on Total Monthly Income for a Single Mother With Two Children in Oklahoma
Table A-6. Impact of DRA Policy on Total Monthly Income for a Single Mother With Two Children in West Virginia
Table B-1. Impact of DRA Policy on Distribution of Child Support Payments for a Mother with Two Children: California
Table B-2. Impact of DRA Policy on Distribution of Child Support Payments for a Mother with Two Children: Illinois
Table B-3. Impact of DRA Policy on Distribution of Child Support Payments for a Mother with Two Children: Maine
Table B-4. Impact of DRA Policy on Distribution of Child Support Payments for a Mother with Two Children: Maryland
Table B-5. Impact of DRA Policy on Distribution of Child Support Payments for a Mother with Two Children: Oklahoma
Table B-6. Impact of DRA Policy on Distribution of Child Support Payments for a Mother with Two Children: West Virginia
R41762: Child Support Enforcement and Driver’s License Suspension Policies
Table 1. Total Child Support Collections Received by Methods of Collection, FY2009
Table 2. Access to a Car in 10 Cities, by Employment Status
Table A-1. State CSE Driver’s License Suspension Policies
R41431: Child Well-Being and Noncustodial Fathers
Table 1. Employment Rates in March of Selected Years for Men without a High School Diploma, by Race/Ethnicity and Age
Table 2. Earned Income Tax Credits: Maximum Credits and Income Eligibility Amounts for Filers With and Without Children, 2012
Table 3. Federal Funding for Teen Pregnancy Prevention Programs, FY2012
Figure 1. Poverty Rates for Children, by Family Type: 1959 to 2011
Figure 2. Percent of all Related Children Under Age 18 Living in Single-Parent, Female-Headed Families: 1960 to 2012
Figure 3. Living Arrangements of Children, March 2012
Figure 4. Median Annual Earnings of Men and Women Who Work Full-Time, Full-Year: 1960 to 2011
Figure 5. Average Annual Earnings for Men Aged 18 and Older, by Education Level: 1975 to 2010
Figure 6. Employment Rates for Men and Women: 1948 to 2012
Figure 7. Employment Rates for Men by Age: 1948 to 2012
Figure 8. Unemployment Rates for Men and Women: 1948 to 2012
Figure 9. Incarceration Rates By Sex: 1925 to 2010
Figure 10. Percent of Men Without a High School Diploma, by Race/Ethnicity and Age: 2011
Figure 11. Mean Earnings for Men Without a High School Diploma, by Race/Ethnicity: 2010
Figure 12. Incarceration Rates in 2010
R40499: Child Support and Ex-Offenders
Figure 1. Estimated Number of Parents in State and Federal Prisons, Data for 1991, 1997, 1999, 2004, and 2007
This page was prepared on November 7, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Table 8-1. Summary of National Child Support Program Statistics, Selected Fiscal Years 1978-2013
Table 8-3. Financing of the Federal-State Child Support Enforcement Program, FY2012
Table 8-4. Financing of the Federal-State Child Support Enforcement Program, FY2013
This page was prepared on November 7, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following provides a legislative history of Child Support Enforcement during the 113th Congress. For prior legislative history, please see the 2012 Green Book.
Public Law 113-183, the Preventing Sex Trafficking and Strengthening Families Act, includes several CSE provisions. It attempts to standardize and streamline the enforcement of child support in international cases by: (1) requiring the Secretary of HHS to use the authorities provided by law to ensure the compliance of the United States with any multilateral child support convention/treaty to which the United States is a party; (2) amending federal law so that the federal income tax refund offset program is available for use by a state to handle CSE requests from foreign reciprocating countries and foreign treaty countries; (3) requiring states to adopt the 2008 amendments to the Uniform Interstate Family Support Act (UIFSA) verbatim to ensure uniformity of procedures, requirements, and reporting forms; and (4) clarifying which state court has controlling jurisdiction in establishing, enforcing, and modifying child support orders.
Public Law 113-183 provides Indian tribes or tribal organizations access to the Federal Parent Locator Service by designating them as “authorized persons.” It also allows Indian tribes or tribal organizations that operate a CSE program to be considered a state for purposes of authority to conduct an experimental pilot or demonstration project under the Section 1115 waiver authority to assist in promoting the objectives of the CSE program.
Public Law 113-183 includes a Sense of the Congress statement that specifies that: (1) establishing parenting time arrangements (also known as visitation) when obtaining child support orders is an important goal which should be accompanied by strong family violence safeguards; and (2) states should use existing funding sources to support the establishment of parenting time arrangements, including child support incentives, Access and Visitation Grants, and Healthy Marriage Promotion and Responsible Fatherhood Grants.
Public Law 113-183 requires data standardization within the CSE program to improve the ability of two or more systems or entities to exchange information and to correctly use the information that has been exchanged. Also, it requires the HHS Secretary, in conjunction with developing the CSE strategic plan, to review and provide recommendations for cost-effective improvements to the CSE program. In addition, it requires all states to use electronic processing of automated systems for the collection and disbursement of child support payments via the State Disbursement Unit by the transmission of child support orders and notices to employers for income withholding purposes using uniform formats prescribed by the HHS Secretary and, at the option of the employer, using the electronic transmission methods prescribed by the Secretary.
This page was prepared on October 1, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Federal Office of Child Support Enforcement
U.S. Bureau of the Census: Child Support Data
This page was prepared on July 14, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Child care has been an ongoing issue of public policy concern primarily because, in most American families with children, parents are working outside the home and must arrange for care for their children. This is true regardless of whether parents are married or unmarried and regardless of the age of their children, although mothers of school-age children have a higher rate of employment than mothers of preschoolers. Thus, some form of child care is a fact of life for the majority of families with children, and federal grants and tax credits exist to help offset the expense for those who purchase child care.
Over time, policymakers have debated the appropriate federal role in addressing questions of availability, affordability, and quality of child care. The role of child care as a work support for low-income and welfare-recipient families has been a particular focus of debate. In recent years, child care as a policy issue has broadened into the related areas of early childhood development and education, as research has focused on the connection between children’s early experiences and their successful long-term development. Child care discussions increasingly include a focus on content and quality, while discussions of early childhood development and education increasingly address the need for coordination with child care services to fit the schedules of working families.
The federal government has used a number of different strategies to invest in child care, including broad-based social programs as well as targeted child care programs and tax provisions. This section of the Green Book focuses primarily on the Child Care and Development Fund (CCDF), a term used to refer to the combination of mandatory and discretionary child care funding streams administered jointly by the U.S. Department of Health and Human Services (HHS). The CCDF is the primary source of federal funding dedicated solely to child care subsidies for low-income working and welfare families.
The FY2014 funding level for the CCDF was roughly $5.3 billion, which included $2.4 billion in discretionary funds and $2.9 billion in mandatory funds. Discretionary CCDF funding is authorized by the Child Care and Development Block Grant Act of 1990 (as amended). Mandatory CCDF funding is authorized in Section 418 of the Social Security Act (sometimes referred to as the "Child Care Entitlement to States").
The CCDF provides block grants to states, according to a formula, which are used to subsidize the child care expenses of working families with children under age 13. In addition to providing funding for child care services, funds are also used for activities intended to improve the overall quality and supply of child care for families in general.
This chapter of the Green Book includes a Congressional Research Service (CRS) Report on the CCDF (CRS Report RL30785). One section identifies Tables and Figures found in this report, while a separate section includes Additional Tables and Figures that provide historical and current data on CCDF program statistics and funding. A limited number of these tables go beyond the scope of the CCDF, providing contextual information on labor force participation of mothers and average wages of child care workers. This chapter of the Green Book also includes a Legislative History of federal spending on child care, with a focus on the evolution and implementation of the CCDF. Finally, this chapter concludes with a list of Links to Additional Resources, including links to CCDF administrative and expenditure data published by the U.S. Department of Health and Human Services, as well as national estimates of child care costs and arrangements produced by the U.S. Census Bureau.
This page was prepared on September 8, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation.
RL30785: The Child Care and Development Block Grant: Background and Funding
This page was prepared on September 8, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
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The following figure and tables related to child care can be found in the CRS report included in this Green Book chapter.
RL30785: The Child Care and Development Block Grant: Background and Funding
Table 1. Funding Trends in the CCDF, FY1997-FY2014
Table 2. FY2014 CCDF Allocations
Table A-1. FY2009 CCDF Allocations
Figure 1. Child Care Programs Before and After Welfare Reform in 1996
This page was prepared on September 8, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
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Figure 9-1. Federal Funding Appropriated to the CCDF, FY1997-FY2014
Figure 9-2. Total Federal and State CCDF Expenditures, FY1997-FY2012
Figure 9-5. Percent of Children Eligible Under State Rules Who Were Served by the CCDF in FY2011
Figure 9-6. Percent of Families Served by CCDF by Reason for Eligibility in FY2012
Figure 9-7. Percent of Children Served by CCDF by Age Group in FY2012
Figure 9-8. Percent of Children Served by CCDF by Payment Method in FY2012
Figure 9-9. Percent of Children Served by CCDF by Setting in FY2012
Figure 9-10. Average Monthly CCDF Provider Payment by Setting in FY2012
Figure 9-11. Average Monthly CCDF Provider Payment by Age Group in FY2012
Figure 9-12. Average Monthly CCDF Provider Payment by Setting and Age Group in FY2012
Table 9-1. Overview of Select Federal Programs that Support Child Care
Table 9-2. CCDF Funding History, FY1997-FY2014
Table 9-3. CCDF State Allocations Based on Appropriations for FY2014
Table 9-4. CCDF Expenditures in Nominal Dollars and Constant FY2012 Dollars, FY1997-FY2012
Table 9-9. Average Hourly Wages for Child Care Workers and Preschool Teachers, May 2013
The following provides a legislative history of Child Care during the 112th Congress through the first session of the 113th Congress. For prior legislative history, please see the 2012 edition of the Green Book.
In the aftermath of American Recovery and Reinvestment Act (ARRA), which was signed into law by President Obama on February 17, 2009 (P.L. 111-5), annual appropriations laws have generally provided slight increases in discretionary CCDBG funding. Despite this, discretionary CCDBG funding available in FY2013 ($2.206 billion) decreased relative to FY2012 ($2.278 billion) as a result of budget sequestration. Sequestration is a spending reduction process under which budgetary resources are permanently canceled to enforce budget policy goals. While the final FY2014 appropriations law (P.L. 113-76) increased discretionary CCDBG funding to $2.360 billion, it did so following a sixteen day funding gap and shutdown of the federal government that occurred due to the failure of Congress and the President to enact appropriations prior to the start of the fiscal year. Anticipating the possibility of a funding gap, the Acting Assistant Secretary for Children and Families at HHS released a letter to state child care officials in September 2013, clarifying that unspent child care funds from prior years would remain available for expenditure in accordance with existing obligation and liquidation timeframes.
Notably, annual appropriations laws starting in FY2011 have also included changes to a CCDBG reservation for a national child care hotline. The FY2011 appropriations law eliminated a CCDBG set-aside for the Child Care Aware toll-free hotline (typically funded at $1 million annually), a phone line staffed by child care consumer education specialists who respond to questions from parents and child care providers about elements of quality child care and how to locate child care programs in local communities. However, the FY2012 law subsequently reserved roughly $1 million for a "competitive grant" (i.e., not an earmark directly to Child Care Aware) for the operation of a national toll-free hotline and website for the dissemination of child care consumer education and to help parents access child care in their communities. The FY2013 and FY2014 appropriations laws continued to provide funding for this competitive grant.
Meanwhile, the authorization and pre-appropriations for mandatory child care funding established by the DRA expired at the end of FY2010. Since then, mandatory funding for child care has been provided through a series of short-term extensions, the most recent of which (P.L. 113-76) maintained mandatory child care funding at the same level ($2.917 billion) through September 30, 2014. (Note that mandatory child care funds are exempt from budget sequestration, and thus were not reduced in FY2013.)
This page was prepared on September 5, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
CCDF Funding Allocations by State and Tribe
Historical CCDF Expenditure Data, FY1999-FY2012
Historical CCDF Program Statistics, FY1998-FY2012
FY2012 Preliminary CCDF Program Statistics (Tables 1-17)
Who’s Minding the Kids? Child Care Arrangements: Spring 2011 – Detailed Tables (Tables 1-6)
Women in the Labor Force: A Databook, 2013 Edition
Table 7. Employment status of women by presence and age of youngest child, March 1975–2012
Historical Editions of Women in the Labor Force: A Databook (2004 edition onward)
BLS Occupational Employment Statistics Homepage
BLS Occupational Employment Statistics on Child Care Workers (May 2013)
BLS Occupational Employment Statistics on Preschool Teachers (May 2013)
This page was prepared on September 5, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The Social Services Block Grant (SSBG) is permanently authorized by title XX, subtitle A, of the Social Security Act as a “capped” entitlement to states. This means that states are entitled to their share of funds, as determined by formula, out of an amount of money that is capped in statute at a specific level (also known as a funding ceiling). Block grant funds are given to states and territories to achieve a wide range of social policy goals, which include promoting self-sufficiency, preventing child abuse, and supporting community-based care for the elderly and disabled. States have broad discretion over the use of these funds. In FY2010, the largest expenditures for services under the SSBG were for foster care services for children, child care, and special services for the disabled.
The SSBG has received annual appropriations of $1.7 billion in every year since FY2002. However, in FY2013 and FY2014, the appropriated funding level for the SSBG was reduced to $1.613 billion and $1.578 billion, respectively, due to budget sequestration. (Sequestration is a spending reduction process under which budgetary resources are canceled to enforce budget policy goals.) In addition to funding from annual appropriations, the SSBG has occasionally received supplemental appropriations, most recently to support states in responding to the effects of Hurricane Sandy in 2013, natural disasters in 2008, and the Gulf Coast hurricanes of 2005.
At the federal level, the SSBG is administered by the U.S. Department of Health and Human Services (HHS). Legislation amending title XX is typically reported by the House Ways and Means Committee and the Senate Finance Committee.
Title XX of the Social Security Act was created in 1975 (P.L. 93-647); however, it was the Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35) that amended title XX to establish a Block Grant to States for Social Services. More recently, health reform legislation enacted in March 2010 (P.L. 111-148) inserted a new subtitle on elder justice into title XX, which was itself re-titled as Block Grants to States for Social Services and Elder Justice. (Under this new law, the SSBG is authorized in subtitle A of title XX, while the elder justice provisions are contained in subtitle B of title XX.) The health reform law also amended subtitle A of title XX to establish two demonstration projects to address the workforce needs of health care professionals and a new competitive grant program to support the early detection of medical conditions related to environmental health hazards. These other components of title XX are not addressed in great detail here; the purpose of this section of the Green Book is to provide an overview of the SSBG.
This chapter of the Green Book includes a Congressional Research Service (CRS) Report on the SSBG (CRS Report 94-953). One section identifies Tables and Figures included in this report, while a separate section provides Additional Tables and Figures that present historical and the most recent available (FY2010) data on SSBG expenditures by state and service category. A Legislative History of the SSBG is provided in the next section, including a description of earlier efforts by the federal government to support state spending on social services. Finally, this chapter concludes with Links to Additional Resources, including SSBG administrative data published by HHS.
This page was prepared on August 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation.
94-953: Social Services Block Grant: Background and Funding
This page was prepared on August 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
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The following tables and figures related to the SSBG can be found in the CRS report included in this chapter of the Green Book.
94-953: Social Services Block Grant: Background and Funding
Table 1. SSBG Funding, FY1985-FY2014
Table 2. FY2013 and FY2014 SSBG Allotments to States and Territories
Table 3. Total SSBG Expenditures by Service Category, FY2010
Table A-1. TANF Transfers to the SSBG in FY2013
Table B-1. State Allocations from the FY2013 Supplemental
Table B-2. State Allocations and Spending from the FY2008 SSBG Supplemental
Table B-3. State Spending from the FY2006 SSBG Supplemental
Figure B-1. HHS Allocation Methodology for the FY2008 SSBG Supplemental Funding
This page was prepared on August 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
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Figure 10-2. SSBG Expenditures by Select Services Categories, FY2010
Table 10-1. SSBG Funding Levels in Nominal and Constant FY2013 Dollars, FY1982-FY2014
Table 10-2. SSBG Allocations by State and Territory, Selected Fiscal Years 1997-2014
Table 10-3. Comparison of the Number of States Offering Selected Services, Fiscal Years 2000-2010
Table 10-4. Use of SSBG Funds by Expenditure Category, Fiscal Years 2001-2010
This page was prepared on August 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
The following provides a legislative history of the Social Services Block Grant (SSBG) during the first session of the 113th Congress. For prior legislative history, see the 2012 edition of the Green Book.
The Consolidated and Further Continuing Appropriations Act, 2013 (P.L. 113-6), maintained annual SSBG appropriations at $1.7 billion for FY2013 and maintained the 10% TANF transfer authority for states. However, the amount appropriated for FY2013 was reduced to $1.613 billion due to sequestration. In FY2013, the SSBG also received supplemental funding of $475 million, post-sequester, from the Disaster Relief Act, 2013 (P.L. 113-2). The supplemental stipulated that these funds were for necessary expenses resulting from Hurricane Sandy. On March 28, 2013, HHS issued an information memorandum regarding the availability of these supplemental funds. According to the memorandum, five states were allocated supplemental funds based on their relative share of FEMA Individual Assistance registrants from Hurricane Sandy, as of March 18, 2013. These states were: Connecticut ($10.6 million), Maryland ($1.2 million), New Jersey ($226.8 million), New York ($235.4 million), and Rhode Island ($0.5 million).
Congress and the President did not enact FY2014 appropriations prior to the start of the fiscal year, October 1, 2013. This resulted in a funding gap and government shutdown that lasted sixteen days until a short-term continuing resolution was signed into law on October 17, 2013. A second FY2014 continuing resolution was enacted on January 15 (P.L. 113-73) and maintained temporary government-wide funding until the FY2014 omnibus was signed by the President on January 17 (P.L. 113-76). Ultimately, President Obama signed into law the Consolidated Appropriations Act, 2014 (P.L. 113-76) on January 17, 2014. This law appropriated $1.7 billion for the SSBG and maintained the 10% TANF transfer authority for states. The FY2014 appropriation level was reduced to $1.578 billion due to sequestration.
This page was prepared on August 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
HHS/ACF/OCS SSBG Annual Report – 2010
HHS/ACF/OCS SSBG Annual Reports, 2007-2009
Title XX of the Social Security Act Online
This page was prepared on August 25, 2014, for the 2014 version of the House Ways and Means Committee Green Book.
Federal child welfare policy is largely concerned with preventing the abuse or neglect of children in their own homes and responding to the consequences of such abuse or neglect. The primary goals of the policy are to ensure children’s safety and permanence, and to promote the well-being of children and their families.
Under the U.S. Constitution, states are believed to have the primary obligation to ensure the welfare of children and their families. At the state level, the child welfare “system” consists of public child protection and child welfare workers, private child welfare and social service workers, state and local judges, prosecutors, and law enforcement personnel. These representatives of various state and local entities assume interrelated roles while carrying out child welfare activities, including investigating reports of child abuse and neglect, providing services to strengthen and support biological, adoptive, and kinship families, removing children from their homes when that is necessary for their safety, supervising and administering payments for children placed in foster care, working to permit safe reunification of children with their parents or, when this is not possible, finding them a new permanent family through adoption, legal guardianship or placement with a fit and willing relative, and providing services to help youth who “age out” of foster care become successful adults.
Most children or families served by a public (state or local) child welfare agency first come into contact with that agency following an allegation of child abuse or neglect. There are some 75 million children in the nation, and in FY2012 state or local child protective service workers investigated or otherwise provided a response to allegations of abuse or neglect involving some 3.2 million children. An estimated 1.2 million of those children and their families receive additional services following this child protective services response and states identified 686,000 children as victims of child abuse or neglect under state law. The large majority of children who received child welfare agency services after an abuse or neglect investigation or response were served in their own home rather than being removed to foster care.
Foster care is a temporary living arrangement for children who cannot safely remain in their own homes. There were some 255,000 children who entered foster care in FY2013 and for most of them (58%) states reported that neglect was one of the circumstances that led to their removal from their homes and placement in foster care. Other circumstances of removal for children entering care in FY2013 included (alone or in combination with additional factors) drug abuse by the child’s parent (28%), “caretaker inability to cope” (17%), physical abuse (14%), a child behavior problem (13%), inadequate housing (9%), parental incarceration (8%), alcohol abuse by child’s parent (6%), abandonment (5%), and sexual abuse (4%).
The number of children remaining in foster care on a given day of the year has been in decline. A high of 567,000 children were reported in foster care on the last day of FY1999 and that number had declined to a low of 397,000 as of the last day of FY2012. On the last day of FY2013, states reported 402,000 children in foster care. The general decline in the number of children in foster care may be credited to successful efforts by states to reduce the length of time children spend in care, locate more permanent homes for children and, in more recent years, reduce the number of children entering care.
Federal involvement in state and local child welfare activities is tied to the financial assistance it provides to states to conduct, or supervise the conduct of, this work. As a condition of receiving federal child welfare funds, states are required to abide by certain federal policies intended to further the overarching goals of safety, permanency and well-being for children and their families.
For FY2014, Congress appropriated $8.0 billion in funding dedicated to child welfare purposes. The large majority of that funding was authorized under Title IV-B or Title IV-E of the Social Security Act, distributed to state child welfare agencies based on a formula or entitlement, and provided on a mandatory or direct funding basis. States are typically required to provide their own (that is, non-federal) funds to receive these federal dollars, ranging from a minimum of 20% to 50% of total program costs.
Title IV-B is the primary source of dedicated federal support for child welfare-related services and these funds may be used to serve any child or family deemed to need these services and without regard to whether a child lives at home, in foster care, or was previously in foster care. State, territorial, and tribal child welfare agencies receive the bulk of Title IV-B funding ($689 million in FY2014) under the Stephanie Tubbs Jones Child Welfare Services and Promoting Safe and Stable Families programs; they used these funds primarily to provide child protection, family support, family preservation, family reunification, and adoption promotion and support services. A smaller portion of the overall Title IV-B funding is distributed to the highest court in each state (to improve handling of child abuse and neglect proceedings), awarded competitively to support child welfare-related projects (including grants addressing substance abuse and supporting family connections), or is used for other child welfare-related research, training, and technical assistance.
Under the Title IV-E program, states are entitled to receive partial federal support for the cost of providing foster care to each child who meets the Title IV-E foster care eligibility criteria. For eligible children, federal reimbursement is available for a part of the cost of providing foster care maintenance payments (i.e., room and board) as well as for certain required case planning and review activities, program-related training, and other program administration costs. In FY2014, Congress provided budget authority of $4.3 billion to reimburse states for the federal share of Title IV-E foster care.
Most federal child welfare requirements are concerned with children who are in foster care. States are generally required to provide the same case planning, review and other protections to children in foster care without regard to their Title IV-E eligibility status. However, they may not use Title IV-E program funds (federal or required state share of Title IV-E) to provide those protections to children not eligible for Title IV-E. The number of children eligible for Title IV-E foster care maintenance payments has declined even more sharply than the overall decline in all children in foster care. Although this share varies considerably by state, on a national basis far less than half of all children in foster care are claimed by states as receiving Title IV-E foster care maintenance payments (i.e., 159,000 on an average monthly basis in FY2013). Federal foster care eligibility criteria are multi-faceted, reflecting Congressional concern that children not be unnecessarily removed from their homes and that while in foster care they are in safe settings. However, the decline in the share of children meeting the federal Title IV-E foster care eligibility criteria is often attributed to the program’s static income eligibility guidelines which are fixed at levels determined in each state as of July 1996. The average state federal foster care income eligibility standard represented 42% of the federal poverty guidelines for FY2014 (based on a family of three). The comparable average for FY1996 was 62%.
Additional federal funding (also under Title IV-E) is available for children who leave foster care for adoption or legal guardianship (with kin). For FY2014, Congress appropriated $2.6 billion in budget authority to reimburse states for the federal share of the cost of supporting children in new permanent homes. The number of children on whose behalf federal adoption assistance was paid more than doubled between FY1999, when this assistance was paid on behalf of 195,200 children on an average monthly basis, and FY2013, when some 431,500 children received this assistance in an average month. Federal Title IV-E support for kinship guardianship was initially authorized effective with FY2009, and the number of guardianship recipients has been small but is expected to grow considerably as more states take the option to provide this kind of Title IV-E support. (In FY2013 about 17,200 children in 29 states received Title IV-E kinship guardianship assistance on an average monthly basis.)
Further, there is some dedicated funding (under the Chafee Foster Care Independence Program, also in Title IV-E of the Social Security Act) related to meeting the needs of youth who are expected to “age out” of foster care without placement in a permanent family and for those who have already aged out. Services and other supports provided are intended to help these youth make a successful transition to adulthood, and they are generally available for youth under the age of 21. For FY2014 Congress provided $183 million for this purpose. The number of youth aging out (also referred to as “emancipating”) grew from an estimated 19,000 during FY1999 to close to 31,000 during FY2009 when that number represented more than 11% of all children who left care. However, it has since declined. In FY2013 more than 23,000 aged out of foster care, representing just under 10% of all children leaving foster care in that year.
Federal child welfare programs authorized under Title IV-B and Title IV-E of the Social Security Act are administered by the Children’s Bureau, which is within the Administration on Children, Youth, and Families (ACYF), Administration for Children and Families (ACF), at the U.S. Department of Health and Human Services (HHS). In Congress, those programs are under the jurisdiction of the House Committee on Ways and Means and the Senate Committee on Finance.
A comparatively small amount of dedicated federal child welfare funding ($94 million in FY2014) is provided under several grants authorized in the Child Abuse Prevention and Treatment Act (CAPTA). Under CAPTA, which was established in 1974, states are required to have a system in place to receive and respond to allegations of abuse and neglect, among other requirements. CAPTA is also administered by the Children’s Bureau, and in Congress is under the jurisdiction of the House Committee on Education and the Workforce and the Senate Committee on Health, Education, Labor and Pensions (HELP).
Other federal child welfare programs authorized outside of the Social Security Act include primarily competitive grants to states, local governments, and nongovernmental agencies to do the following:
Most of the programs authorized outside the Social Security Act have annual funding of less than $30 million each and are administered by the Children’s Bureau; a few are administered by the Office of Justice Programs within the Department of Justice. In the House the jurisdiction of these programs has traditionally been spread over the Education and the Workforce and Judiciary Committees and in the Senate over the HELP and Judiciary Committees.
Separately, funding for the Maternal, Infant and Early Childhood Home Visiting (MIECHV) program (Title V, Section 511 of the Social Security Act; $371 million in FY2014) is distributed to all states and tribes (via formula and competitive grants) to support home visiting services that promote maternal, infant and child health; improve school readiness and achievement; prevent child abuse or neglect and injuries; improve family economic self-sufficiency; reduce crime or domestic violence; and improve coordination and referrals for community resources and supports. Home visiting, which supports the primary child welfare goals of safety and well-being, is a service frequently provided by child welfare agencies (using Title IV-B or other federal funding). The MIECHV program, first authorized to receive funding in FY2010, is administered primarily by state public health or social service agencies.
Most federal child welfare requirements are included in Title IV-B and Title IV-E of the Social Security Act. To receive federal support through the federal child welfare programs authorized under those parts of the law, states must provide no less than 20% of total program costs, and may be required to provide up to 50% of total program costs (depending on the program and kind of activity). As a condition of receiving these federal funds, states must also provide certain protections to each child in foster care (and without regard to whether or not the child meets federal Title IV-E eligibility criteria). Further, states must meet additional federal requirements related to planning for and administering services to children and families. State compliance with these requirements is subject to various federal audits and conformity reviews, of which the most comprehensive is the Child and Family Services Review (CFSR).
States spend substantial funds on child welfare purposes and, on a national basis, generally exceed the amount needed to access full federal child welfare funding. For example, in FY2014 federal dedicated child welfare funding was about $8.0 billion, and given statutory participation (sometimes called “matching”) rates, states would be expected to spend about $3.9 billion in state and local funds to fully draw down that funding. This suggests total federal, state, and local spending authorized under federal child welfare programs of just less than $12 billion. However, according to a survey of state child welfare agency spending for state fiscal year 2012 (the most recent available), those public agencies spent $28.2 billion on child welfare activities in that year with a little more than half of this spending ($15.5 billion or 55%) coming from state or local funds. The remainder ($12.7 billion) drew on federal funds, including the funding streams discussed above that are dedicated to child welfare purposes (primarily Title IV-E and Title IV-B), as well as additional federal funding that states may choose to direct to child welfare purposes. Principally this “non-dedicated” funding is expended by states’ child welfare agencies out of federal funds provided under the Temporary Assistance for Needy Families (TANF) block grant, the Social Services Block Grant (SSBG), and Medicaid.[1]
This chapter focuses on programs that authorize federal child welfare funding to all states, and that must be used for child welfare purposes and are authorized under Title IV-B and Title IV-E of the Social Security Act. It includes links to several Congressional Research Service (CRS) Reports about those programs. A separate section includes Additional Tables and Figures related to child welfare. Other parts of this chapter include a Legislative History and Links to Additional Resources.
This page was prepared on October 12, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
[1]Kerry DeVooght, Megan Fletcher, and Hope Cooper, Federal, State, and Local Spending to Address Child Abuse and Neglect in SFY2012, Child Trends, Casey Family Programs, and Annie E. Casey Foundation (September 2014).
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation.
Major Child Welfare Programs: Funding, Eligibility and State Plan Requirements
R43458: Child Welfare: An Overview of Federal Programs and Their Current Funding
R42792: Child Welfare: A Detailed Overview of Program Eligibility and Funding for Foster Care, Adoption Assistance and Kinship Guardianship Assistance under Title IV-E of the Social Security Act (PENDING)
RL34499: Youth Transitioning from Foster Care: Background and Federal Programs
Health Care of Children in Foster Care
R42378: Child Welfare: Health Care Needs of Children in Foster Care and Related Federal Issues
Selected Acts Amending Child Welfare Programs (prior Acts included below and available in earlier Green Book versions)
R42027, Child Welfare: The Child and Family Services Improvement and Innovation Act (P.L. 112-34)
RL30759, Child Welfare: Implementation of the Adoption and Safe Families Act (P.L. 105-89)
This page was prepared on November 20, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures related to Child Welfare can be found in the CRS reports section of this Green Book chapter.
R43458: Child Welfare: An Overview of Federal Programs and Their Current Funding
Table 1. Final Funding for Stephanie Tubbs Jones Child Welfare Services Program
Table 2. Final Funding for Promoting Safe and Stable Families (PSSF) Program
Table 3. Final Discretionary and Mandatory PSSF Funding, by Program/Activity
Table 4. Final Funding for Family Connection Grants
Table 5. Final Funding for Child Welfare Research, Training, or Demonstration Projects
Table 6. Budget Authority Provided Under the Title IV-E Program
Table 7. Final Funding for Tribal Title IV-E Plan Development and Technical Assistance (TA)
Table 8. Final Funding for the Chafee Foster Care Independence Program (CFCIP)
Table 9. Final Funding for Adoption Incentive Payments
Table 10. Final Funding for Child Abuse Prevention and Treatment Act (CAPTA)
Table 11. Final Funding for Children’s Justice Act Grants
Table 12. Final Funding for Programs Under the Victims of Child Abuse Act (VOCAA)
Table 13. Final Funding for Adoption Opportunities
Table 14. Final Funding for Abandoned Infants Assistance
Table A-1. Funding Authority and Sequestration Status of Child Welfare Programs
Table 1. Programs and Activities Authorized Under Title IV-B of the Social Security Act
Table 2. Description of Purposes and Activities by Selected Service Category
Table A-1. Funding for the CWS and PSSF Programs, FY1990-FY2014
Table B-1. Description of Selected Categories of Services Used for Reporting Expenditures under Title IV-B
Table C-1. Title IV-B Funding by State, FY2014 Table C-2 Title IV-B Funding by State, FY2013
Table D-1. PSSF Funding by Kind of Authority and by Activity, FY1994-FY2014
Table D-2. PSSF Annual Funding Authorization and Distribution, FY2012-FY2016
Table E-1. Funding Authority and Appropriations for the Court Improvement Program, FY1995-FY2014
Table E-2. Funding Awarded by CIP Purpose and State, FY2014
Table E-3. Funding Awarded by CIP Purpose and State, FY2013
Table F-1. Performance Indicators for Regional Partnership Grants
Table G-1. State Monthly Casework Visits Percentage and Visits in Home of Child Percentage, FY2012 and FY2013
Figure 1. States Planned Use of Federal Title IV-B Funding for FY2013, by Purpose
Figure 2. Funding for the Stephanie Tubbs Jones Child Welfare Services (CWS) and Promoting Safe and Stable Families (PSSF) Programs, FY1990-FY1994
Figure 3. Children Brought to the Attention of the Child Welfare Agency
Figure 4. Planned Use of FY2013 Federal CWS Funds by Kind of Service or Activity
Figure 5. Trend in Funding for the CWS Program, Nominal and Constant Dollars, FY1990-FY2014
Figure 6. Trend in Funding for the PSSF Program, Nominal and Constant Dollars, FY1994-FY2014
Figure 7. Amount of PSSF Funding by Activity, Selected Fiscal Years
Figure 8. Planned Use of FY2013 Federal PSSF Funds for Child and Family Services by Kind of Service or Activity
Figure 1. Total Federal and State Title IV-E Spending, FY2013
Figure 2. Child Protections Offered as Part of the Case Review System
RL34499: Youth Transitioning from Foster Care: Background and Federal Programs
Table A-1. Comparison of Outcome Domains Between Young Adults in the Midwest Study and Young Adults in the Add Health Study
Table B-1. FY2011 and FY2012 CFCIP General and ETV Allotments by State
Figure 1. Share of Current and Former Foster Youth Who Received an Independent Living Service(s) by Type of Service Received, FY2011-FY2013
Figure 2. Selected Outcomes of Current and Former Foster Youth at Age 19, FY2013
Table 1. Characteristics of Current and Former Foster Youth Who Received an Independent Living Service and Service(s) Received
Table 2. Demographics of Current and Former Foster Youth at Age 19 and Their Outcomes by Foster Care Status and Receipt of Independent Living Services, FY2013
R42378: Child Welfare: Health Care Needs of Children in Foster Care and Related Federal Issues
Table A-1. Comparisons of Select Outcomes Between Young Adults in the Midwest Study and Young Adults in the Add Health Study
Table A-2. Presence of Certain Health and Mental Health Conditions Among All Children, All Adopted Children, and Children Adopted from Foster Care
Table B-1. Medicaid Services Spending for “Foster Care” Children by Types of Service, Selected Fiscal Years
Table C-1. Major Mandatory and Optional Medicaid Pathways for Current and Former Foster Children and Youth
Figure 1. Medicaid Spending for “Foster Care” Children by Selected Categories and Fiscal Years
This page was prepared on October 12, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The Title IV-E Foster Care and Adoption Assistance Caseload
Table 11-1. Title IV-E Caseload by Kind of Assistance, Number and Rate, FY1984-FY2013
Table 11-2. Estimated Caseload and Federal Outlays under the Title IV-E Program, FY2014-FY2019
Table 11-5. Number of Children Entering Foster Care by Age, FY2001-FY2013
Table 11-5A. Rate of Children Entering Foster Care by Age, FY2001-FY2013
Table 11-5B. Share of Children Entering Foster Care by Age, FY2001-FY2013
Table 11-6. Number of Children Entering Foster Care by Race/Ethnicity, FY2001-FY2013
Table 11-6A. Rate of Children Entering Foster Care by Race/Ethnicity, FY2001-FY2013
Table 11-6B. Share of Children Entering Foster Care by Race/Ethnicity, FY2001-FY2013
Table 11-8. Children Entering Foster Care by Prior Removal Status, FY2004-FY2013
Table 11-9. Number of Children in Foster Care by Age, FY2004-FY2013
Table 11-9A. Rate of Children in Foster Care by Age, FY2004-FY2013
Table 11-9B. Share of Children in Foster Care by Age, FY2004-FY2013
Table 11-10. Number of Children in Foster Care by Race/Ethnicity,FY2001-FY2013
Table 11-10A. Rate of Children in Foster Care by Race/Ethnicity, FY2001-FY2013
Table 11-10B. Share of Children in Foster Care by Race/Ethnicity, FY2001-FY2013
Table 11-11. Children in Foster Care by Case Plan Goal, FY2004-FY2013
Table 11-12. Number of Months in Foster Care, by Race/Ethnicity, FY2004-FY2013
Table 11-13. Number of Children in Foster Care by Current Placement Setting, FY2004-FY2013
Table 11-13A. Share of Children in Foster Care by Current Placement Setting, FY2004-FY2013
Table 11-17. Number of Children Exiting Foster Care During FY2001-FY2013, by Reason for Exit
Table 11-17A. Share of Children Exiting Foster Care During FY2001-FY2013, by Reason for Exit
Table 11-18. Number of Children Exiting Foster Care by Age and Reason for Exit, FY2013
Table 11-18A. Share of Children Exiting Foster Care by Age and Reason for Exit, FY2013
Table 11-19. Number of Exits from Foster Care by Reason and Race/Ethnicity, FY2013
Table 11-19A. Share of Exits from Foster Care by Reason and Race/Ethnicity, FY2013
Table 11-20. Adoptions with Public Child Welfare Agency Involvement, FY1998-FY2013
Table 11-21. Average and Median Length of Time to Finalized Adoption, In Months, FY2000-FY2013
Figure 11- 1. What Does A Title IV-E Foster Care Dollar Buy?
Figure 11- 2. What Does A Title IV-E Permanency Dollar Buy?
Figure 11-3. Foster Care Entry Rates by Age, Selected Fiscal Years
Figure 11-4. Foster Care Entry Rates by Race/Ethnicity, FY2001-FY2013
Figure 11-5. Median Length of Stay in Foster Care by Race/Ethnicity, Selected Fiscal Years
Figure 11-7. Current Placement Setting by Age of Child in Foster Care, FY2013
This page was prepared on October 12, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The information below provides the legislative history of child welfare programs since the end of the first session of the 112th Congress and through September 30, 2014, during the second session of the 113th Congress. For prior legislative history, refer to the 2012 Green Book. Note that this prior legislative history is primarily, but not exclusively, concerned with the development of programs currently authorized under Title IV-B and Title IV-E of the Social Security Act. While it is somewhat detailed, it is not comprehensive.
The Protect Our Kids Act of 2012 (P.L. 112-275, enacted January 2013) called for establishment of the Commission to Eliminate Child Abuse and Neglect Fatalities. The Commission is charged with studying services used to reduce child abuse and neglect fatalities and developing recommendations for a national comprehensive strategy to reduce such fatalities, including recommendations for appropriate legislative and administrative actions.
The Preventing Sex Trafficking and Strengthening Families Act (P.L. 113-183, enacted September 2014) amends the federal (Title IV-E) foster care program to require state child welfare agencies to develop and implement procedures for identifying, documenting in agency records, and determining appropriate services for certain children or youth who are victims of sex trafficking or at risk of victimization. State child welfare agencies must also report to law enforcement and HHS about such victims. HHS must establish a national advisory committee on child sex trafficking that, among other responsibilities, must develop policies on improving the nation’s response to domestic sex trafficking. P.L. 113-183 also includes provisions to direct child welfare agencies to develop protocols on locating children missing from care.
P.L. 113-183 also seeks to ensure children in foster care have the opportunity to participate in activities that are appropriate to their age and stage of development. It requires changes in state foster home licensing law to enable foster caregivers to apply a “reasonable and prudent parenting” standard when determining whether a child in foster care may participate in activities and directs state child welfare agencies to provide training to caregivers on using this standard. Other provisions in the law seek to ensure permanent adult connections for older children and better aid for their transition to successful adulthood. Under the new law, states are not permitted to assign a permanency plan of “another planned permanent living arrangement” (APPLA) to any child under the age of 16, and must take additional steps to support permanency for children age 16 or older who are assigned that permanency plan. Further, children in foster care who are age 14 or older must be consulted in the development of, and any revisions to, their case and permanency plans. They must also be made aware of their rights while in care, including the right to receive critical documents (e.g., birth certificate, Social Security card) when they “age out” of care.
P.L. 113-183 extended funding authority for Adoption Incentive Payments for three years (FY2014-FY2016), renamed them (as of October 1, 2014) as the Adoption and Legal Guardianship Incentive Payments, revised the incentive structure to allow states to earn incentive payments for both adoptions and exits from foster care to legal guardianship, and placed additional focus on finding permanent homes for older children. The new incentive structure, which is being phased in, gauges state performance based on changes in the rate (or percentage) of adoptions and legal guardianships a state achieved (rather than number). Separately, P.L. 113-183 requires 30% of any state savings (resulting from broadening federal eligibility for Title IV-E adoption assistance) to be used for family strengthening services, including post-adoption services. It also includes provisions to ensure continued federal assistance under the Title IV-E program for eligible children who, following the death or incapacitation of their legal guardian, are placed with previously named successor guardians. Additionally, the law appropriated $15 million to continue Family Connection Grants for one year.
This page was prepared on October 27, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Child Maltreatment – An annual report that includes national and state-by-state information on number of children found to be victims of child abuse or neglect, number of child abuse or neglect fatalities, and other related data.
Adoption and Foster Care Analysis Reporting System (AFCARS) Reports – An annual report that includes national data concerning children entering or exiting foster care in a given fiscal year, those who remain in foster care on the last day of the fiscal year, those who were waiting to be adopted on the last day of the fiscal year, and those who were adopted during the fiscal year. For state level data on adoptions with public child welfare agency, scroll down to annual links provided under the heading “State Specific Adoption Statistics.”
Number of Children Entering or Exiting Foster Care During the Fiscal Year and Number in Care on the Last Day of the Fiscal Year – A table showing data by state for FY2004-FY2013.
Number of Children Adopted with Public Child Welfare Agency Involvement by State, FY2004-FY2013
Child Welfare Outcomes Database – An interactive site that allows users to select which state or states they would like to see information about and for what years. The website was launched in January 2011 and is to be annually updated. The site includes all the data that is published in the congressionally mandated Child Welfare Outcomes report (Section 479A of the Social Security Act), as well as data showing state performance on certain standards used to assess states as part of the Child and Family Services Review (CFSR). The website continues to be developed and readers may want to check back periodically to learn about any new resources posted.
National Survey of Child and Adolescent Well-Being (NSCAW) – Reports and other information based on the congressionally mandated national random sample study of child welfare (Section 429 of the Social Security Act). Includes links to research briefs, reports, and other information based on nationally representative samples of children who come into contact with child welfare agencies and their families.
National Survey of Adoptive Parents – Reports based on survey of adoptive parents, including special study of parents who adopted children out of foster care.
Child Welfare Policy Manual – The Children’s Bureau has issued both formal federal regulation as well as less formal “program instructions” to interpret and implement federal child welfare law. The online Child Welfare Policy Manual draws on these sources (and current law) to offer guidance on federal child welfare policy. Information is organized, topically, by program and is provided in a question and answer format.
State Statute Series – Available via the Children’s Bureau supported information clearinghouse (known as the Child Welfare Information Gateway), the State Statute Series provides a brief overall summary of state statutes regarding selected child abuse and neglect, foster care, and adoption issues. It also shows the relevant excerpt of state law for each issue.
State Child Welfare Policy Database – This website was developed and is managed by the social policy research group, Child Trends, with funding from Casey Family Programs. It includes state-level information on laws, policies, and practices related to kinship care, child welfare financing, older youth in care, family foster care reimbursement rates, programs to prevent child maltreatment, differential response, domestic violence, definitions of child abuse and neglect, and mandatory reporting of child abuse or neglect.
Information about past, currently operating, and planned child welfare demonstration projects, including federal policies related to these projects is available online.
States are held accountable to federal child welfare policy through a variety of mechanisms and reviews. Links to information about two reviews are provided below.
Child and Family Services Review – The Child and Family Services Review (CFSR) is the most comprehensive federal effort to determine whether states are in “substantial conformity” with state plan requirements made under Title IV-B and Title IV-E of the Social Security Act. The review is periodically conducted and focuses on outcomes achieved by the state for the children and families it services as well as the systems in place to achieve those outcomes. Each review includes a statewide assessment and an onsite review. State “substantial conformity” is determined using standardized data measures, case record reviews, and stakeholder interviews. States found not in “substantial conformity” with federal child welfare policy face a fiscal penalty unless they are able to successfully implement a Program Improvement Plan (PIP). General information about the CFSR, including how the review is conducted is available online.
A report on findings of the most recent round of reviews (FY2007-FY2010) is available online.
Copies of individual state assessments and state final reports are available online.
Title IV-E Eligibility Review – A Title IV-E Eligibility Review is periodically conducted in each state to ensure the state accurately applies federal eligibility rules related to determining federal eligibility for Title IV-E foster care assistance. Information about the review, including state final reports is available online.
Child Welfare Information Gateway – Clearinghouse of information on broad range of child welfare topics.
AdoptUSKids – Among other things, includes a photo listing of children available for adoption as well as information and resources, nationally and by state, for families seeking to adopt.
Social Security Act
The Social Security Administration maintains an online compilation of the Social Security Act. Child welfare programs and activities authorized in the Social Security Act are in Title IV-B, Title IV-E and sections of Title XI.
Child Abuse Prevention and Treatment Act (CAPTA), Adoption Opportunities, and Abandoned Infants Assistance
The Children’s Bureau maintains a compilation of these acts on its website. The document at this link incorporates all amendments made to them through their most current reauthorization, P.L. 111-320, enacted in December 2010.
This page was prepared on November 18, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The Pension Benefit Guaranty Corporation (PBGC) is a federal government agency that was established in 1974 to protect the benefits of participants in private-sector defined benefit pension plans. The PBGC runs two insurance programs: a single-employer program and a multiemployer program. Single-employer pension plans are plans to which one employer makes contributions. Multiemployer pensions are collectively bargained pension plans to which more than one employer contributes. The single-employer program is the larger of the two insurance programs.
The PBGC oversees the termination of single-employer defined benefit pension plans and pays the benefits to participants in those terminated plans which do not have assets sufficient to pay 100% of promised benefits. There is a statutory maximum benefit which the PBGC is allowed to pay ($59,318 per year for a worker in a pension plan terminated in 2014 who receives a single-life annuity beginning at age 65). Most participants in terminated pension plans receive the full benefit earned at the time of plan termination.
The PBGC does not pay benefits to participants in multiemployer pensions. Rather, the PBGC provides insolvent multiemployer plans with financial assistance, in the statutorily-required form of loans, which PBGC indicates are rarely repaid, sufficient to pay PBGC guaranteed benefits and reasonable administrative expenses. The maximum benefit is an annuity of $12,870 for a worker with thirty years of service.
The two insurance programs are financed by premiums paid by sponsors of defined benefit plans, investment income, assets from pension plans trusteed by the PBGC, and recoveries from the companies formerly responsible for the trusteed plans. The PBGC does not receive any funds from general tax revenues and the obligations of the PBGC are not obligations of the U.S. government. The PBGC had a deficit of $35.7 billion at the end of fiscal year 2013, of which $27.4 billion was from the single-employer program and $8.3 billion was from the multiemployer program. PBGC expects the single-employer program’s deficit to improve over the next 10 years. However, PBGC expects the multiemployer program to deplete its assets and be unable to pay out statutorily required benefits in 8 years.
This chapter of the Green Book includes Congressional Research Service (CRS) Reports, a section that lists Tables and Figures in the CRS reports, Legislative History and Links to Additional Resources.
This page was prepared on August 19, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. One CRS report with a cover date earlier than 2014 is included here because its content remains relevant.
95-118: Pension Benefit Guaranty Corporation (PBGC): A Primer
RS22624: The Pension Benefit Guaranty Corporation and Single-Employer Plan Terminations
R43305: Multiemployer Defined Benefit (DB) Pension Plans: A Primer and Analysis of Policy Options
This page was prepared on August 19, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following tables and figures can be found in the CRS reports included in this chapter of the Green Book.
95-118: Pension Benefit Guaranty Corporation (PBGC): A Primer
Table 1. Number of Standard and Trusteed Pension Plan Terminations
Table 2. PBGC Single and Multiemployer Insurance Programs: Net Financial Position, FY2002 – FY2013
Table 3. Pension Benefit Guaranty Corporation (PBGC) Benefit Payments and Payees, 1996 – 2012
Table 4. PBGC Multiemployer Insurance Program: Financial Assistance to Pension Plans
Figure 1. Financial Position of the Single-Employer Insurance Program of the Pension Benefit Guaranty Corporation
Figure 2. Financial Position of the Multiemployer Insurance Program of the Pension Benefit Guaranty Corporation
Table 1. PBGC Single-Employer Program Data: FY2004 to FY2013
Table 2. PBGC Single-Employer Program Premium Levels
Figure 1. Financial Position of the Single-Employer Insurance Program of the Pension Benefit Guaranty Corporation
R43305: Multiemployer Defined Benefit (DB) Pension Plans: A Primer and Analysis of Policy Options
Table 1. Single and Multiemployer Pension Plans in 2011
Table 2. Defined Benefit Multiemployer Plan Certification in 2011
Figure A-1. Typical Balance Sheet of a Defined Benefit Pension Plan
Figure A-2. How Future Pension Benefits Are Discounted
Figure A-3. Present Value Formula
This page was prepared on August 19, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
The following provides a legislative history of the Pension Benefit Guaranty Corporation from the 112th Congress through the first session of the 113th Congress. For prior legislative history, please see the 2012 Green Book.
The Moving Ahead for Progress in the 21st Century Act (MAP-21, P.L. 112-141) increased the premiums that plan sponsors pay to PBGC and made changes to the governance of PBGC.
MAP-21 increased the single-employer flat-rate premium to $42 per participant in 2013 and to $49 per participant in 2014, after which it would again be indexed for increases in the annual rate of growth in the average national wage.
MAP-21 increased the variable-rate premium, which had been $9 per $1,000 of underfunding, by $4 (after indexing) per $1,000 of unfunded vested benefits in 2014, and by another $5 (after indexing) per $1,000 of unfunded vested benefits in 2015. After 2015, the variable rate will be indexed for increases in annual rate of growth in the national average wage. MAP-21 provided a new rule that the maximum variable-rate premium cannot exceed $400 per participant in 2013. After 2013, the maximum variable-rate premium will be indexed for increases in the national average wage index.
MAP-21 made changes to the governance structure of PBGC, such as providing that the term of the Director of PBGC be five years, requiring the board of directors to meet at least four times per year, creating a Participant and Plan Sponsor Advocate in PBGC, and requiring independent reviews of governance structures and of the PBGC’s Single-employer and Multiemployer Pension Insurance Modeling Systems. MAP-21 repealed PBGC’s statutory authority to borrow up to $100 million from the U.S. Treasury on an unsecured basis.
P.L. 113-67 (introduced as H.J.Res. 59) was the vehicle for the December 2013 bipartisan budget agreement that increased PBGC premiums. The single-employer flat-rate premium increased to $57 in 2015 and $64 in 2016. After 2016, the flat-rate premium will again be indexed to increases in the average national wage. H.J.Res. 59 increased the variable-rate premium in 2015 by an additional $10 over the 2014 rate (after the 2014 rate is indexed for increases in the average national wage) per $1,000 of unfunded vested benefits and by an additional $5 (after the 2015 rate is indexed for increases in the average national wage) in 2016 per $1,000 of unfunded vested benefits. After 2016, the variable-rate premium will again be indexed to increases in the average national wage. P.L. 113-67 increased the maximum variable-rate premium to $500 per participant beginning in 2016.
The Moving Ahead for Progress in the 21st Century Act (MAP-21, P.L. 112-141) increased the premiums that the sponsors of multiemployer defined benefit pension plans pay to PBGC. MAP-21 increased the 2013 premium by $2 per participant, after being increased for changes in the growth of the national average wage. After 2013, the multiemployer plan premium will continue to be indexed for increases in the annual rate of growth in the national average wage index.
This page was prepared on August 19, 2014 for the 2014 version of the House Ways and Means Committee Green Book.
Pension Benefit Guaranty Corporation, www.pbgc.gov
Many of the programs authorized under the Social Security Act that fall under the jurisdiction of the House Committee on Ways and Means and are featured in the Green Book are designed to provide benefits and services to low-income populations. Eligibility for benefits such as cash assistance or supportive services is typically determined using income or other needs-based standards. In some cases, these programs serve overlapping population groups. Reviews of programs designed to serve specifically low-income populations generally exclude social insurance programs, such as Social Security, Unemployment Insurance, and Medicare.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. The following CRS reports provide cross-cutting information on low-income programs and policies. Certain CRS reports with cover dates earlier than 2014 are included here because their content remains relevant.
R41823: Low-Income Assistance Programs: Trends in Federal Spending
R43400: Work Requirements, Time Limits, and Work Incentives in TANF, SNAP, and Housing Assistance
R42394: Drug Testing and Crime-Related Restrictions in TANF, SNAP, and Housing Assistance
This appendix was prepared on September 23, 2014, for inclusion in the 2014 version of the House Ways and Means Green Book.
Many, but not all, social welfare programs that are available in the 50 states and the District of Columbia are also available in the United States territories of American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.[1] Some programs are only available in certain territories and for some programs the territories receive funding based on different formulas or under different circumstances than do the states.
This Appendix provides information on the availability in each territory of the following two types of social welfare programs:
1. Federal Programs that Make Direct Payments to Individuals--These programs have federal eligibility and benefit rules, and are administered directly by the federal government.[2]
2. Federal-State Programs--For these programs, states, and in some cases localities, have a role in the design, administration, and often financing of benefits and services. For a territory to participate in the joint federal-state programs, federal law must make the territory eligible for the program, and the territory’s government must act to meet the program’s conditions for federal assistance.
Information on the coverage of each territory for each direct payment program is provided in Table B-1 while information on coverage for each federal-state program is provided in Table B-2. Additional information on certain programs under the jurisdiction of the House Committee on Ways and Means is also provided.
The federal government administers several large social welfare programs that provide benefits directly to individuals. These benefits are in the form of retirement, disability, and survivors benefits administered by the Social Security Administration (SSA), Railroad Retirement Board (RRB), and Department of Veterans Affairs (VA), as well as medical benefits provided by the Medicare program and by the VA. Direct benefits are also provided to needy aged, blind, and disabled persons and through Department of Education grant and loan programs.
The Supplemental Security Income (SSI) program provides means-tested cash assistance to needy aged, blind, and disabled individuals, including disabled children. Benefits are paid without regard to work or insurance requirements, and are financed by general revenue funds. Eligibility in the SSI program is limited to residents of the 50 states, the District of Columbia, and the Northern Mariana Islands.
Prior to the establishment of the SSI program by the Social Security Amendments of 1972, benefits for the needy aged, blind, and disabled were provided by the states and territories, with the exception of American Samoa, and financed by federal grants under Titles I, X, XIV, and XVI of the Social Security Act. The 1972 amendments replaced this system of grants with the federal SSI program in the states and District of Columbia only. Residents of the territories were excluded from the SSI program. The territories of Guam, Puerto Rico, and the U.S. Virgin Islands remain eligible for federal grants for aid to the aged, blind, and disabled. Residents of American Samoa are not eligible for SSI or benefits under the aged, blind, and disabled grants. Eligibility for SSI for residents of the Northern Mariana Islands was included in the 1976 covenant that established the Northern Mariana Islands as a United States territory.
Many social welfare programs are operated by the states and territories using federal funds and in accordance with federal guidelines. Often, in order for a state or territory to participate in one of these programs, the state or territorial government must provide matching funds or meet other program requirements. As a result, in some cases, a state or territory may be eligible for a program but may choose not to participate in that program.
Major federal-state programs include the unemployment compensation system and the nation’s major public assistance, nutrition assistance, and child care assistance programs. Federal-state programs also provide benefits to older persons and persons with disabilities, and finance certain education and rehabilitation programs.
The Omnibus Territories Act, enacted in 1977, authorizes federal agencies to consolidate grants, except for grants that provide direct services to individuals, awarded to American Samoa, Guam, the Northern Mariana Islands, and the U.S. Virgin Islands. Consolidated grant funds may be co-mingled and used for any purpose permitted under any of the programs consolidated into the grant. Puerto Rico is not eligible for grant consolidation. Today it is common for territories to consolidate several grants from the Department of Health and Human Services into larger grants such as the Social Services Block Grant.[3] One advantage to grant consolidation for the territories is that it allows the territories to receive federal funds in some cases without having to meet all of the program rules that apply to states.
Section 1108 of the Social Security Act places a ceiling on the total amount of annual grant funding that may be awarded by the Department of Health and Human Services for certain programs to American Samoa, Guam, Puerto Rico, and the U.S. Virgin Islands.[4] Section 1108 does not set a ceiling for grants to the Northern Mariana Islands. Grants for Aid to the Aged, Blind, and Disabled; Temporary Assistance for Needy Families (TANF); and foster care and adoption assistance under Title IV-E of the Act are included in this ceiling. The current ceilings, set by statute and not subject to any automatic adjustment, are:
Table B-2 provides a list of territorial eligibility for and participation in selected federal-state programs. Programs under the jurisdiction of the House Committee on Ways and Means that have special rules for territorial eligibility are discussed below.
Puerto Rico and the U.S. Virgin Islands are the only territories eligible under federal law for the Unemployment Compensation program. These two territories have Unemployment Compensation programs as certified by the Department of Labor. As a result, Puerto Rico and the U.S. Virgin Islands can access federal Unemployment Compensation benefits when available through temporary programs, such as the now-expired Emergency Unemployment Compensation (EUC08) program, or the permanent Extended Benefit (EB) program.
Under the federal-state child support enforcement program, the federal government finances 66% of a state or territory’s child support enforcement program. The federal government also provides incentive payments to state and territorial child support enforcement programs to encourage program effectiveness. While each of the territories is eligible to participate in the federal-state child support enforcement program, only Guam, Puerto Rico, and the U.S. Virgin Islands currently have territorial programs that qualify for federal support.
The federal government provides foster care and adoption assistance to states and territories under Title IV-E of the Social Security Act. In addition, states and territories that participate in the Title IV-E program are eligible for grants under the John H. Chafee Foster Care Independence Program to help current and former youths in foster care achieve self-sufficiency. While Title IV-E of the Social Security Act does not specifically define which territories may be eligible for foster care and adoption assistance, the definition of “state” provided in Title XI of the Social Security Act states that for the purposes of Title IV of the Act, the term “state” includes American Samoa, Guam, Puerto Rico, and the U.S. Virgin Islands, but not the Northern Mariana Islands.
Puerto Rico is the only territory that currently participates in the federal foster care and adoption assistance program. However, Puerto Rico has historically received limited or no funding for its program because it has not been able to determine program eligibility to the satisfaction of the Department of Health and Human Services and has not developed a required cost-allocation plan.
The Temporary Assistance for Needy Families (TANF) program provides block grants to states and eligible territories to provide cash welfare and other benefits to qualified needy families. Guam, Puerto Rico, and the U.S. Virgin Islands are eligible for TANF funds and participate in the program. American Samoa is eligible for TANF funds but does not participate in the program. Under federal law, the Northern Mariana Islands is not eligible for TANF funds.
This appendix was prepared on September 24, 2014, for inclusion in the 2014 version of the House Ways and Means Green Book.
[1] This appendix discusses the availability of social programs in the five major territories and provides an overview of special rules that apply in the territories. It does not discuss federal financial assistance for three areas that were formally part of the trust territories and are now independent in "free association" with the United States: the Marshall Islands, the Federated States of Micronesia, and Palau. These areas remain eligible for some residual aid from the United States.
[2] This appendix’s classification of programs making direct payments to individuals differs from that found in federal budget documents and the Census Bureau’s published Consolidated Federal Funds Report. This appendix classifies unemployment compensation as a federal-state program because states administer and design their own programs within federal guidelines. The Supplemental Nutrition Assistance Program (SNAP) program is also classified in this appendix as a federal-state program because it is administered by the states.
[3] The rules for the consolidation of grants from the Department of Health and Human Services are provided in the Code of Federal Regulations at 45 C.F.R. §§ 97.10-97.16.
[4] Section 1108 of the Social Security also sets ceilings on Medicaid funding for the territories.
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A complex set of rules governs the eligibility of noncitizens for federal benefits, including under many of the programs overseen by the House Committee on Ways and Means and featured in the Green Book. These rules are determined largely by the type of noncitizen in question and the nature of the services being offered. Unauthorized aliens are not eligible for federal public benefits, except for a narrow set of specified emergency services and programs.
The House Ways and Means Committee is making available selected reports by the Congressional Research Service (CRS) for inclusion in its 2014 Green Book website. CRS works exclusively for the United States Congress, providing policy and legal analysis to Committees and Members of both the House and Senate, regardless of party affiliation. The following CRS reports provide an overview of policies affecting noncitizen eligibility and access to selected federal benefit programs.
RL33809: Noncitizen Eligibility for Federal Public Assistance: Policy Overview and Trends
RL34500: Unauthorized Aliens’ Access to Federal Benefits: Policy and Issues
R43561: Treatment of Noncitizens under the Affordable Care Act
This appendix was prepared on September 29, 2014, for inclusion in the 2014 version of the House Ways and Means Green Book.